TasGas is to begin selling electricity to residential customers from next year, and will rebrand to become Solstice Energy, the company confirmed.
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Solstice Energy chief executive officer Phaedra Deckart said the company's decision to become an electricity retailer would help Tasmanians by boosting competition in the marketplace.
It will become the tenth retailer in the space, following the collapse last year of Elysium Energy, which took a hit when wholesale market prices surged over 300 per cent in winter 2022.
Tasmania's electricity market is small and highly concentrated, with almost 90 per cent of it in 2022-2022 controlled by Aurora Energy, according to a report of the Tasmanian Economic Regulator.
"Our ambition is to provide more local choice, with more investment in new technology, ideas and alternatives," Ms Deckart said.
"We recognise Tasmanians' frustration by their lack of options for electricity and we understand the impact that the lack of real competition has had on household bills" she said.
"Our entry to electricity retailing in Tasmania will introduce much-needed competition in the Tasmanian energy market and provide a real and credible local choice for households across the State.
"We know customers will welcome more competition and we're pleased to be able to drive that benefit into Tasmanian homes and businesses.
"We also aim to offer more help in easing cost-of-living pressures and more rewards for customers who stick with us."
Ms Deckart said Solstice Energy will continue to operate the gas pipeline infrastructure and sell gas to retail and other customers as a "core" part of its business.
That gas business has not been as successful as originally planned when TasGas and the state government began building the network after the opening of the Tasmanian Gas Pipeline in 2002.
Plans for a more extensive distribution network were put on hold after demand turned out to be less than expected, as electricity supplied by Aurora Energy turned out to be the cheaper offer for households.
The company's switch to electricity offers a new avenue for growth in Tasmania.
Goanna Energy consultant Marc White said Solstice's entry into the Tasmanian retail electricity market next year would come at an "opportune" time.
This was because at present, the differential between what retailers are allowed to charge customers and the wholesale market prices where they source their electricity.
"There's about 10 cents per kilowatt hour in the standing offer residential tariffs and small business tariffs, whilst the wholesale market is around seven cents a kilowatt hour," Mr White said.
