Households across most of Australia’s eastern seaboard face higher electricity bills within months as authorities prepare to increase the maximum prices that retailers can charge.
The Australian Energy Regulator has released a draft decision to lift price caps for hundreds of thousands of customers on standing retail plans, known as default offers, in most regions from July 1.
Sharp increases in power prices have intensified cost-of-living pressures in Australia in recent years.Credit: Paul Jones
In an announcement on Thursday, the regulator said prices would increase between 2.5 and 8.9 per cent for customers in NSW, South East Queensland and South Australia.
In Victoria, where the state’s Essential Services Commission sets its own default offers, prices will remain “relatively flat”, ranging from a cut of $19 to an increase of $68 depending on the region.
Power price increases present a political challenge for the Albanese government as it heads into an election in which the high cost of living will be a key issue for voters. However, the government is widely expected to issue a third round of power bill relief in the federal budget on March 25.
Changes to this year’s regulated prices will directly affect hundreds of thousands of consumers who do not take up special deals from their power providers. They will also act as a reference point for electricity retailers such as AGL, Origin and EnergyAustralia as they assess their next pricing cycles across their customer bases.
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Australian Energy Regulator chair Clare Savage acknowledged that cost-of-living pressures were “front-of-mind” for many households and small businesses.
However, the default prices had to factor in higher costs across electricity generation and the transmission network.
“We have given careful scrutiny to every element of the default market cost stack to ensure prices are a reasonable reflection of the costs of a retailer to supply electricity,” she said.
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