COLLECTIVE bargaining for energy prices by agribusinesses has been approved by the Australian Consumer and Competition Commission.
A group of Victorian agribusinesses formed the Eastern Energy Buyers Group and applied to the ACCC to run a joint tender processes for electricity, gas and gas transport.
Members will pool their electricity and gas demands and place tenders in the market.
Combining their energy demands would enable the buyers’ group to seek more competitive pricing and terms for supply and share the costs of contract negotiation and legal services.
Joint purchasing of electricity and gas will generate efficiencies compared to each member of the purchasing group sourcing energy separately,” ACCC Chairman Rod Sims said.
“This joint tendering process is likely to result in public benefits as the group should be able to seek gas and electricity at a more competitive price.”
The group includes Ridley, Rivalea, Turi Foods, Australian Lamb Co., CSF Proteins, Diamond Valley Port, Gathercole Group, HW Greenham and Sons and Herd.
The group's’ combined electricity demand is relatively modest, about 0.12 terawatt hours or 0.27 per cent of Victorian electricity consumption. The combined gas demand is 1.2 Petajoules, or 0.75pc of Victorian gas consumption.
The authorisation allows other industrial energy users to join the group and significantly increase the size of the joint tender, provided the combined annual energy consumption does not exceed 4.5 terawatt hours of electricity and 16 petajoules of gas.