The Australian Energy Regulator (AER) says Queensland households should save an average of $34 on electricity next year, provided proposed lower distribution charges are passed onto customers.
The regulator says 45 per cent of household power bills can be attributed to the cost of distributing electricity through the network. It says demand for electricity in Queensland is falling and expected to remain flat between 2015 and 2020.
"This puts less strain on the network and requires less investment to provide a reliable supply of energy," AER board member Jim Cox said.
In its preliminary decision, the AER rejected the amounts that Ergon Energy and Energex wanted to recover from customers. Energex wanted to recover $8.4 million from customers over the next five years, but the AER will allow it to recover $6.5 million.
Ergon Energy would be able to recover $6 million, less than the $8.2 million proposed by the electricity distributor.
However the Electrical Trades Union says the AER's draft decision does not take into account the considerable savings that the merging of Energex, Ergon and Powerlink will provide over the next five years.
The preliminary decision also comes after the Palaszczuk government deferred electricity deregulation for 12 months, sparking fears that more price increase were on the way.
Deregulation would allow more electricity distributors to enter the market, putting pressure on prices.