Page 2384 - Week 07 - Tuesday, 30 July 2019
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2014-15 data, the ICRC estimated that petrol delivery costs for Canberra retailers are around 1.3c a litre higher than those faced by retailers in Sydney.
In addition to these interstate comparisons, the ICRC also observed variations across different locations within the ACT. The ICRC found that the daily average price is more volatile in some individual districts such as—again, surprise, surprise!—Fyshwick and the airport compared with the whole of Canberra average, reflecting once again the higher level of competition in these areas. Some indications of an irregular price cycle were found in the Canberra Airport area.
Petrol prices also vary significantly by brand and region, reflecting the different business models, ownership structures, retail operating costs and competition levels. The annual average price at Costco and Metro were below the market average by 16c and 13.7c per litre respectively, whilst prices at Coles Express were on average 3.3c per litre above the ACT average.
When comparing petrol cost components by region in Canberra, the ICRC found that retailers at the airport and Fyshwick had the lowest net retail margins, operating costs and wholesale costs, while retailers in south Canberra had the highest net retail margin and wholesale costs, and retailers in northern Canberra had the highest operating costs. Despite these variations, the average retail price for 2017-18 for all areas of Canberra, other than the airport and Fyshwick, was between 142.9c per litre and 143.3c per litre compared to 132.7c per litre at the airport and Fyshwick.
Madam Assistant Speaker, the Assembly Select Committee on Fuel Pricing inquiry released its interim report in May of this year. The committee outlined a number of potential measures for further consideration, including enhancing consumer information, increasing the presence of independent retailers, regulatory options and subsidies for low income earners. The findings from the ICRC’s investigation confirm that the key contributing factor to higher petrol prices and retail margins in the territory is relatively weak competition due to the presence of a low number of independent retailers.
I have highlighted to the committee the importance of improving the competitive environment and would seek their further consideration of the potential barriers and opportunities for independent retailers seeking to establish a presence in Canberra, and the areas in which the government may be able to act to reduce barriers and enable opportunities to be harnessed.
The committee is considering a hierarchy of approaches and whether some measures should be deployed together. Further consideration of options, with the potential to provide a solution over the next decade or so until low and zero emission vehicles become commonplace, would indeed be welcome. I look forward to the committee’s final report, which is expected to be released in the middle of September.
In closing, I take this opportunity to thank the senior commissioner of the ICRC, Mr Joe Dimasi, and his staff for their work in undertaking this most comprehensive of investigations into petrol prices in the territory. The report will provide valuable information for the committee as it completes its inquiry and
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