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Selling off the farm: ‘diabolical’ power bills after global giant buys Australian energy assets

Friday, 15 December 2017
By Graham Osborne

Fishprint at Brighton East, Melbourne

Peter Booth, director of Melbourne’s Fishprint, recently invested $1.4 million in a new low-energy offset press in a bid to cut soaring electricity charges. But despite managing to reduce its power usage by one third, the business has been hit by yet another substantial increase in its power bill.

‘It’s all smoke and mirrors’: Peter Booth, director Fishprint.

“It’s diabolical really because we’re doing all we can to cut power consumption,” says Booth. “We’ve reduced our energy use by a third, from 3,000kwh to 2,000kwh a month, but this latest bill is $1400 – $150 higher than the previous one and $600 more than we calculated we’d be paying. And that’s just for one of our two factories. I’m still waiting for the bill for the other one, which uses a bit more power. We’re looking at paying $2,400 a year more for that.”

Booth contacted his local power company, Momentum Energy, a retailer owned by Hydro Tasmania, and was told the increased charges were the result of a new summer surcharge being passed on from Victorian electricity network United Energy, part of the Duet Group.

In April 2017, Duet was acquired in a $7.4 billion takeover by Hong Kong-based global infrastructure giant Cheung Kong Infrastructure Holdings (CKI), after Australian Treasurer Scott Morrison said he had no objection to the deal and it was cleared by the Foreign Investment Review Board.

Li Ka-Shing, chairman CK Asset Holdings.

In the same month, CKI announced that Paul Tighe, the former Australian Consul-General to Hong Kong, would be joining the company as a non-executive director on HK$75,000 per year. ANZ Banking Group is listed as one of CKI’s principal bankers.

The company – led by Hong Kong’s richest man, billionaire Li Ka-Shing, and with its registered office located in popular tax haven Bermuda –  has steadily increased its Australian assets over recent years, paying $2.4 billion in 2014 for Envesta, which distributes gas through Victoria, Queensland and South Australia. Li-controlled companies also own stakes in SA Power Networks, Powercor Australia, Australian Gas Networks and CitiPower.

In its interim 2017 report to the Stock Exchange of Hong Kong in July, CKI said the value of the DUET business was approximately A$13 billion.

During the period under review, CKI made a milestone investment with the acquisition of DUET. DUET is an owner and operator of energy utility assets which are mostly located in Australia. Its businesses comprise regulated network businesses, contracted gas pipelines, and power generation projects.

The enterprise value of the business is approximately A$13 billion. CKI now owns a 40% stake in the business, with associate companies of the CK Group – Cheung Kong Property Holdings Limited (“CKPH”) and Power Assets Holdings Limited (“Power Assets”) – holding 40% and 20% respectively. This acquisition is the largest acquisition ever made by CKI.

The DUET transaction successfully addressed concerns of the Australian Government, paving the way for further investment opportunities in Australia for the Group. 

CKI is one of the biggest overseas infrastructure investors in Australia. It has investments in electricity and gas distribution, gas transmission pipelines, electricity generation, as well as renewable energy power transmission businesses in Australia. CKI owns SA Power Networks, a primary electricity distribution business for the state of South Australia; CitiPower, a company that supplies electricity to Melbourne’s CBD and inner suburbs; Powercor, Victoria’s largest electricity distributor; United Energy, a company that supplies electricity in Victoria; Australian Energy Operations, a renewable energy power transmission business in Victoria; and Australian Gas Networks Limited, one of Australia’s largest natural gas distribution companies; Multinet Gas, a gas distribution company in Victoria; Dampier Bunbury Pipeline, a gas transmission pipeline connecting the Carnarvon/Browse Basins with Perth; and Energy Developments, a provider of low greenhouse gas emissions energy solutions.

‘Against the national interest’: Treasurer Scott Morrison, 2016.

CKI signed the deal for Duet in April, nine months after it was prevented from buying NSW-based Ausgrid because of national security concerns.

Treasurer Morrison said at that time it would be ‘against the national interest’ to allow CKI and the State Grid of China to acquire half of Ausgrid, which supplies power to 1.6 million NSW businesses and households. 

According to The Age, the State Grid of China already controls electricity distribution in north-western Melbourne and, along with Singapore Power, owns Victoria’s network of poles and wires, as well as electricity distribution in eastern Victoria, and gas distribution in western Melbourne and regional Victoria.

“How can the federal government let them do this?” says Booth. “It’s all smoke and mirrors. My first thought upon seeing the bill was: this must be a mistake. We have a strong sustainability focus, we recycle 98 percent of our waste, we’ve installed low energy lighting and low energy equipment, we have little or no air conditioning, we’re doing all we can to cut our power usage…it’s the final straw.

“They call it a ‘summer’ surcharge’ but this bill included the month of November and that’s not even technically summer. I don’t understand how this surcharge works, how long it goes on for, where the money’s going and why it’s been charged to us.

“What about the bloke up the road who hasn’t managed to cut his usage? It’s no wonder we’re hearing stories of printers being forced to cut staff numbers because they can’t afford their power bills.”

After Print21 provided United Energy with details on Thursday morning, Momentum contacted Booth to inform him that Fishprint can be moved onto ‘a different and more favourable’ tariff.

“They told me there is normally a charge to this, but they will waive it,” says Booth. “They are working on my complaint, apparently. I think they know how bad it looks, when you reduce usage so much and your bill goes up so much. A political hot potato?”

CK Infrastructure Holdings is a global infrastructure company with a market capitalisation of about HK$180 billion. The group has investments in energy infrastructure, transportation infrastructure, water infrastructure, waste management and energy management services in Hong Kong, mainland China, the United Kingdom, Europe, Australia, New Zealand, the United States and Canada.

Fishprint, based in Brighton East, specialises in blue chip corporate work that includes brochures, reports newsletters, point of sale items and posters. The company employs about eight full-time staff members. In 2010, Fishprint installed Australia’s first waterless KBA Genius 52UV press.

Update: On Friday, United Energy released this statement:

We are contacting Fishprint to discuss their concerns and what tariff options are available to them.
United Energy has a tariff that includes demand charges for small to medium-sized businesses. Business that typically use 40-160MWh per annum are able to opt out to an alternative tariff without demand components.
While the demand charge occurs throughout the year, it is adjusted according to the season. The summer demand charge occurs from 1 December to 31 March.
Cost reflective charges can reduce energy demand and therefore reduce the need to build expensive infrastructure to cope with large spikes in electricity use.
In Victoria, network charges are regulated and are approved by the Australian Energy Regulator. The Australian Energy Regulator approved these pricing structure last year.
If business customers have any questions about their pricing, we’d encourage them to phone their retailer or us on 1300 131 689.

3 Responses to “Selling off the farm: ‘diabolical’ power bills after global giant buys Australian energy assets”

  1. December 15, 2017 at 3:23 pm,


    When they sold the power industry to foreign interests, they sold out Australia in every way.

  2. December 18, 2017 at 7:51 am,


    What’s next Turnbull & Libs? Sell the Snowy Mountains MkII hydro system to foreign interests? May as well sell the whole bloody country you traitors!

  3. December 19, 2017 at 2:57 pm,


    Power Companies have mixed ownership and are not completely state owned (WA/TAS/NT the exception), so stop blaming only the politicians, also blame the greedy company owners and shareholders.
    I’m tired of the blame game!
    You vote the guys in, you are the companies customers.
    You have a voice, a vote and a choice, just use it!
    Go on the streets, protest, do something and stop arguing about all of this online or in the pub.

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