Huge losses at WA’s state-owned power company could lead to bill hikes or taxpayer bailouts.

The WA Government wants to limit power price rises for residents, but experts say this may require inflation-busting bill hikes or taxpayer-funded bailouts.

The state-owned energy firm Synergy has been crippled by the huge uptake in solar and other renewable power, but still has to stabilise the power grid through costly coal- and gas-fired plants.

Synergy has written down the value of plants and equipment by a massive $430 million, leaving it with a net asset value of just $250 million.

Researcher Adam McHugh says Synergy will face a reckoning.

He says taxpayers already pay for the deterioration in Synergy's bottom line, given that this year's loss will see it pay no dividend to the State.

“If something is not sustainable, by definition it's not sustained,” he told the ABC.

“When you're Government-owned, you've always got the recourse of asking for the Government to borrow … to make up any revenue shortfall. And Synergy's obviously Government-owned.

“That's one way of sustaining an increasingly large gap between revenue and costs.

“The other is increasing prices.”

But Energy Minister Bill Johnston says the Government will not allow Synergy to impose bigger power price rises.

“The important thing for the community to understand is we're not increasing the price of electricity by a large amount anymore,” Mr Johnston said.

“And the reason we can do that is because it's a Government-owned business and we can tell it what to do.
Shadow energy minister Dean Nalder said the slide in Synergy's financial health is unsustainable, and something has to give.

“It's a record loss … and it will either be borne by taxpayers or energy users,” Mr Nalder said.

“It just depends how the Government is going to apply the loss going forward.

“We're asking the Government to come clean on what it proposes to do in the future with Synergy.”