No-cost tariff switching for farmers may only be temporary

QUEENSLAND farmers will be able to switch electricity tariffs at no cost after an Ergon Energy decision, but the arrangement may last only for six months.

State Agriculture Minister John McVeigh and Energy Minister Mark McArdle announced the Ergon changes in a joint statement yesterday.

Ergon Energy will waive the fee for changing between the different types of farming and irrigation tariffs from January 1, 2015.

Mr McVeigh said the decision would reduce production costs which he said were "essential" for the government's plan to double agricultural production by 2040.

"It was made clear to Minister McArdle and me during our tour of Queensland farming communities last month that growers would welcome greater flexibility to move back and forth between 'time-of-use' tariffs (T62 and T65) and the 'fixed-charge' tariff (T66) as it suited them," he said.

Under the current arrangement, farmers can switch tariffs only once a year at no cost. Subsequent changes attract fees.

"The current arrangement does not take into account that seasonal and climatic variations can dramatically alter the timing, duration and amounts of water an irrigator may need to pump," Mr McVeigh said.

The change might last for only six months, however, with a review to take place at the end of the 2014-15 financial year.

Mr McArdle said Ergon Energy would also remove special meter-read fees which come with changing between farming and irrigation tariffs during the billing cycle.

"The dropping of the switching and meter-reading fees mean more choice, greater flexibility and real savings for farmers, as they can select a tariff that best suits their needs. But there is still work to do," he said. - APN NEWSDESK