PREMIER Annastacia Palaszczuk will this week deliver a power price ultimatum to electricity retailers - cut bills or the Government will go into business against you.
The threat to directly re-enter the market 11 years after selling the state's retail divisions follows a damning report by the national consumer watchdog last week that power companies are deliberating confusing customers and using loopholes to gouge households and businesses.
Ms Palaszczuk said the Australian Competition and Consumer Commission investigation had exposed retailers for pocketing savings made in electricity generation, transmission and distribution.
The energy firms now had a choice to make: Share the savings by reducing prices, or the Government would set up its own retailer to undercut them and steal their business.
"I will be calling energy retailers in for a meeting this week," she said.
"They will be given an ultimatum - pass on savings delivered by my Government in full to consumers, or face more competition from a retailer owned by my Government.
"The next move is up to the retailers - and the clock is ticking."
The Government dipped its toe back into the retail market two months ago, announcing state-owned generator CS Energy had struck a deal with Alinta Energy to offer Queenslanders a two-year 25 per cent discount, which could save them $350.
About 50,000 customers have already signed up.
"Alinta was just a start,'' the Premier said. "I'm prepared to re-enter the retail market. We can do it and only Queensland can do it. We own the power stations, the poles and wires."
Modelling suggested a Government retailer could produce annual savings between $180 and $517 a year.
Peter Beattie sold the retail arms of Ergon and Energex in 2006 following advice that market competition would drive power prices down.
But the ACCC report said bills here had soared 52 per cent in the past nine years to an average of almost $2000 per household per year, the highest in the country.
"The consumer watchdog is clear - retailers are taking Queenslanders for a ride," Ms Palaszczuk said.
The Premier is expected to release a comprehensive electricity package to address a two-year lag in Malcolm Turnbull's draft National Electricity Guarantee.
Meanwhile, a ReachTEL poll found voters in three blue-riband Liberal seats are not convinced the Federal Government's new policy will lower power prices.
Between 17 and 20 per cent of people in the electorates held by Mr Turnbull, Environment and Energy Minister Josh Frydenberg and former PM Tony Abbott expect bills to fall.
And a majority in each support a policy to price carbon.