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Electricity price rise to add another $300 to average power bills

Ian Bushnell 11 June 2018 54

Higher wholesale prices and the cost of green schemes are the main contributors to the 14 percent rise in electricity prices in the ACT.

A typical Canberra household’s power bill will rise by about $300 for the year under a 14 percent hike in electricity prices announced on Thursday by the Independent Competition and Regulatory Commission.

The ICRC released its annual update of regulated retail electricity prices for the financial year beginning 1 July 2018, setting the maximum average nominal increase in ActewAGL Retail’s basket of regulated tariffs for 2018-19 at 14.29 percent.

It said that if ActewAGL Retail increased prices by the full 14.29 per cent, this would translate to an increase of up to $299 in the annual bills (or about $5.73 a week) for a typical Canberra household consuming about 8,000 kWh per year.

The ICRC said most of the reasons for the rise were outside of ActewAGL’s control and were the result of higher wholesale electricity prices and the higher cost of national green schemes, fueled by the greater than expected take-up of residential solar energy.

“The large increases in Australian wholesale electricity prices that occurred in 2016 and 2017 are still pushing up ACT electricity prices. While wholesale prices have fallen slightly over the past few months, they are still 50 per cent higher than in May 2016,” Senior Commissioner Joe Dimasi said.

“The Commission’s method of smoothing out large changes in wholesale prices means that ACT retail prices have not increased as much as in other parts of Australia. But there is now a ‘catch-up’ in retail prices in the ACT as the wholesale price increases that happened in 2017 continue to flow through into retail prices.”

The ICRC said higher wholesale electricity purchase costs contributed more than half of the total retail price increase (7.80 percentage points of the total 14.29 percent increase). The national green schemes administered by the Clean Energy Regulator contributed more than a third of the total retail price increase (4.12 percentage points).

ActewAGL’s retail operating costs will fall by 4.42 percent in 2018-19.

The ICRC said that despite the increase in regulated retail prices in 2018-19, electricity bills for ACT residential customers would remain among the lowest in Australia.

“I recognise that the large increase in retail prices in 2018-19 will place financial pressure on ACT residential and small business consumers,” Mr Dimasi said. “However, it should be noted that these are maximum price increases and I encourage consumers to talk to their retailer about whether they are on the right electricity plan for their circumstances and to seek assistance if they need it.”

The ACT Government blamed the price rise on a lack of market certainty that was causing under investment in power generation and leading to a shortfall in supply. It also defended its renewable energy policies.

“The ACT is part of a National Electricity Market, and the bulk of today’s announced increase is outside the control of the ACT Government. However, ACT households and businesses will continue to have some of the lowest cost and most reliable electricity supplies in the country. Canberrans will still be paying hundreds of dollars less per year compared to our neighbours in New South Wales,” Deputy Director General, Sustainability and the Built Environment, Geoffrey Rutledge said.

Mr Rutledge said the ACT’s renewable energy scheme costs would also remain well below the $5.50 per household per week previously estimated, and the Government remained confident that this would decline after peaking in 2020.

He said the ACT Government remained committed to renewable energy and would continue to invest in sustainable electricity generation.

The Government would again join with ActewAGL to provide a support fund of $500,000 for Canberrans struggling with their power bills, and he urged consumers to talk to their energy provider about getting the best deal to meet their needs, or to shop around for a better offer.

“Last year the St Vincent de Paul Society found that Canberrans could save over $200 on their electricity costs simply by switching to a lower priced plan. Online comparator tools like www.energymadeeasy.gov.au are available to help customers check that they are on the best electricity plan for them,” he said.

“Saving energy has never been more cost effective. The ACT Government’s Energy Efficiency Improvement Scheme has assisted over 71,000 households and businesses, including 18,000 low income priority households, to cut their energy bills.”

 Visit www.actsmart.act.gov.au or call 13 22 81 for information and advice on the energy savings opportunities available.

From 1 July, the Utilities Concession for eligible low-income households increases from $604 to $654 per year to assist with electricity costs.


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54 Responses to
Electricity price rise to add another $300 to average power bills
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7:16 am 11 Jun 18

Holly 😒 we had a big rise last year as well

7:34 am 11 Jun 18

Cheers, Barr Gov

7:43 am 11 Jun 18

Bloody hell, how much do they think people can absorb? It all stops getting spent in other areas of the economy. I would like the regulator to publish the reasons why costs have gone up by 14% for the energy companies.

7:58 am 11 Jun 18

Got to pay all the executives.

8:02 am 11 Jun 18

Australia used to have some of the cheapest electricity in the world, now it has some of the most expensive. This is the cost of renewable madness.

    8:05 am 11 Jun 18

    This is the cost of privatising your utilities

    8:11 am 11 Jun 18

    Stephen Matthews it’s not so simple. Costs have increased massively in privatised and state owned markets...

    https://theconversation.com/amp/myths-not-facts-muddy-the-electricity-privatisation-debate-38524

    2:47 pm 11 Jun 18

    Chris Devery Informative

    8:39 pm 11 Jun 18

    If we werent paying at least twice (some people 3 times) for our electricity it would be a lot cheaper........government subsidies come out of our pocket, we pay for it when we use it and if you have solar on your roof you had to pay for the solar panels

8:04 am 11 Jun 18

What our are options here in act?

8:08 am 11 Jun 18

I’d like a wage increase of 14% please

8:12 am 11 Jun 18

This is why we need public services. Big buisness will never put people before profit. I expect we'll see more and more people unable to afford power and gas. What will the independent regulator do about that?

8:18 am 11 Jun 18

When aren't they on the rise? It's hard when you're the only one paying the bill on a pension. Give us a break!

8:39 am 11 Jun 18

ACT Govt hard at work keeping things affordable for Canberran's again ? See no evidence whatsoever,

8:51 am 11 Jun 18

Greedy, greedy, greedy.

8:53 am 11 Jun 18

So is this what renewables offers people in Canberra - price hikes? I thought this was to put downward pressure on the cost of power?

    9:17 am 11 Jun 18

    You’re missing the point. The reality is as more people go off grid with their own power sources the corporatised power operators have less customers. So to protect their profits caused by to lack of customers, the remaining customers are required to make up the loss, thus power prices go up. The power industry in Australia or for that matter do not follow the traditional economic principle of supply and demand. There is an over supply of power but low demand, which would mean the prices would be falling but unfortunately the governments are involved in a scam to protect corporatised power companies the ones the governments sold our power station to. If you want to drive your power prices you need to install solar or invest in battery systems and buy power at the off peak prices. Either way accessing green energy will reduce your cost of power just don’t expect a corporate to do you any favours

    9:19 am 11 Jun 18

    so what does that solar farm/wind mills pump into then - nothing?

    8:45 pm 11 Jun 18

    The solar panels only work while the sun is shining (and only work fully when in full sun) and the wind generators only work within certain wind speeds.........therefore both are only part time at best

    8:46 pm 11 Jun 18

    and without a reasonably stable base neither will work

8:54 am 11 Jun 18

And they wanna take the energy supplement and put the price up.

9:06 am 11 Jun 18

A country drowning in energy and yet we pay some of the highest prices

9:36 am 11 Jun 18

Thanx LNP for privatising just about everything... which in EVERY case has cost the average australian .( i mean the REAL average ) more and given us less.

    10:10 am 11 Jun 18

    It is an ACT Labor government that has been in power for 16 years. The federal government has nothing to do with this.

    10:12 am 11 Jun 18

    Federal Govt has everything to do with overall privatisation of what were public assets!

    9:47 pm 11 Jun 18

    Richard Navakas Its all wholesale prices from the Federal government. Our power bills are actually a lot cheaper than NSW, because the ACT Government have locked in lower rates from Solar and wind. But the federal LNP gov won't mention that and just blame the states and their bad policies at a federal level that is causing this.

Capital Retro 9:43 am 11 Jun 18

These increases will hurt industry too and the unreliability of renewable sources will close industries: https://www.theherald.com.au/story/4919006/smelters-100m-decision/

9:57 am 11 Jun 18

The regulator costs at least $150 to be installed for homeowners and businesses in addition to the hike in costs. Mostly where is the economic responsibility with all of these rises, particularly for those in employed by private industries and small business.

10:06 am 11 Jun 18

How can they justify 14% when the cost of living is only going up by 2 to 3%?

10:16 am 11 Jun 18

This government has presided over massive increases in energy costs. People who signed on to the ACT Greens Labor subsidies some years ago get 45c a kilowatt for what their solar panels produce and only pay around 15 c a kw. This is subsidised now by all electricity users. ACT Labor and the Greens need to be accountable for this increase .

    1:51 pm 11 Jun 18

    Nothing to do with the government in power being ‘left’. The rest of the country has equally great rates to sell their power to the grid.

    4:15 pm 11 Jun 18

    Janine Baines ummm no. Try and sell power to the grid now. You won’t get 45c a kilowatt. Other people are subsidising those who got in on this ridiculous scheme early on.

    9:49 pm 11 Jun 18

    Richard Navakas you won't but our prices are still a lot cheaper than NSW. Power is rising in cost all across the country, its not the ACT government at fault here. All states did similar deals with feed in tariffs on solar.

10:44 am 11 Jun 18

It not independent when the decisions always favour the supplier and not the consumer

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