NSW could start getting a better deal on power prices, but not in time to stop July 1 pain
Soaring power prices will be curbed under a crackdown the Albanese government is launching to stop electricity companies overcharging households in NSW and Queensland that have suffered much larger average price rises than Victorians.
Energy Minister Chris Bowen's pledge to reform how prices are set comes just weeks ahead of an annual surge in power bills kicks in on July 1, leaving the hardest-hit customers on the Essential network in regional NSW up to $228 worse off over the upcoming 12 months.
The government is clamping down on a process run by a Commonwealth authority, the Australian Energy Regulator, which it believes was bad for customers in eastern seaboard states compared to Victoria, where power bills are set by the state-run Essential Services Committee.
Bowen said the current system was not serving bill payers and had to change.
'I don't think it's working that way [it is intended to] and reform is needed,' Bowen will say, according to notes for a speech he will deliver to the Australian Energy Week conference in Melbourne on Wednesday.
In NSW, south-east Queensland and South Australia power prices are set under a default offer, which imposes a maximum prices retailers can charge customers.
While the greatest annual bill increase in NSW topped $200, the greatest in Victoria was $100 and the average price rise across the state was just $20 per customer.
In Victoria, the state's Essential Services Commission sets the maximum bill retailers can charge based on the 'efficient price' of delivering electricity.
However, for other states the Australian Energy Regulator also factors in the cost of competition between electricity companies, as well as the cost of retaining customers, when it decides default offer pricing.
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