Queensland’s state-owned power companies will soon merge into a $24 billion entity.

State Parliament passed laws this week to merge Energex and Ergon into a new company to be based in Townsville.

The laws were passed with the backing of Katter's Australian Party MPs Shane Knuth and Robbie Katter, and Cook independent Billy Gordon.

The Government claims the merger will save about $680 million by 2019-20, while boosting employment in north Queensland.

Energy Minister Mark Bailey said the new body - Energy Queensland - was all about efficiency for taxpayers.

“This merger will remove duplication in areas like administration, shared services, boards, management, and corporate costs,” he said.

“The merger is an important part of the Government's debt action plan, with efficiencies achieved through this process to be used to reduce Government debt.

“Making the businesses more efficient will release funds to invest in better services for all Queenslanders.”

“Work practices will benefit from the combined experience and expertise of both companies.

“It will continue to deliver high levels of safety, reliability and product excellence.”

The new company should be better equipped to respond to emerging technologies and shifting customer needs in an energy industry set to change dramatically in coming years.

But Master Electricians Australia (MEA) says small electrical contractors will be negatively impacted.

Queensland’s 10,000 smaller electrical contracting firms together employ about 50,000 people.

MEA chief Malcolm Richards said the merger itself was not the concern.

“But the new separate energy services business that is also set up under the law change will compete against existing contractors,” he told the ABC.

“It's remarkable the Treasurer is pumping $100 million into regional businesses to employ people while at the same time undertaking a deliberate strategy to compete directly with regional electrical contractors.

“I believe every dollar gained from this energy services subdivision will be a dollar taken from the pockets of regional businesses."

Opposition Treasurer Scott Emerson accused the Government of making a grubby deal with electrical unions.

‘What this is about is a promise that there'll be no redundancies from the mergers,” Mr Emerson said.

“Instead what they've done is move these staff into a private energy provider that will compete against many mum and dad sparky businesses out there.”

But Mr Bailey said Energy Queensland would focus “on new markets and new opportunities, not on ones already established”.