Higher power bills to kick in from July

The Age

26-05-2025

The Australian Energy Regulator released a draft decision on power price rises in March for consultation with power companies and other stakeholders.
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Its prices have remained relatively stable, with the average default offer in Victoria rising $8 in the final determination. Essential Energy in regional NSW had the highest variation between the draft and final determination, with a rise of $28.
Price rises were attributed to a range of factors affecting renewable and fossil-fuel sources.
A significant driver of higher power prices, the regulator said, was breakdowns at coal-fired power plants, which require increased reliance on gas-fired power plants that draw on the highest cost fuel source.
Renewables were also a contributing factor, with rising infrastructure costs to pay for new transmission lines needed to link wind and solar farms to population centres, as well as stretches of low wind that forced increased reliance on fossil fuels.
Renewables currently supply more than 40 per cent of the electricity in the grid, and the Albanese government is aiming to make it 82 per cent by 2030.
Prime Minister Anthony Albanese promised at the 2022 election that the green power shift would cut power bills by $275 by 2025.
However, bills have risen by up to $400 for some residents in NSW and up to $250 for some Victorians since the Albanese government was elected.
Albanese said the renewables transition was an important element of the government's plan to cut emissions to address the impact of climate change
'People who question the science need to look out their window,' Albanese said on Monday as he addressed media from the National Situation Room, where he was briefed on the impact of floods on NSW North Coast.
'We know the cheapest form of new energy is renewables, backed by gas, backed by batteries and backed by hydro for firming capacity.
'We've always had floods and droughts in Australia … but what we do know is that they are more frequent and they are more intense.'
The regulator's chairwoman Clare Savage said customers could get better deals than the default offer by shopping around using the free, independent Energy Made Easy website.
'You cannot have a shift to renewables without having confidence because you will lose community support if people walk into this room here and flick on the switch and the lights don't go on,' Savage said.
'We need to make sure that there is security of energy supply at the same time as we support the transition.'
Savage said while the cost of expanding electricity networks had contributed to higher bills over the coming 12 months, she expected the new infrastructure to help lower bills over the medium to long term.
'As we start to see increased use of the system, from increased demand, we should see that cost pressure in bills come down,' Savage said, noting the uptake of electric cars and appliances such as hot water heaters and reverse cycle air conditioners.
Energy Minister Chris Bowen announced in April that the government would offer another round of energy bill relief worth $150 for households, valid until the end of the year. Homeowners with solar panels can also save 30 per cent on a one-off home electric battery purchase, in a scheme to start on July 1.
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'It's clear energy bills for Australians remain too high, and we're providing help for people doing it tough as we deliver longer term reform,' Bowen said.
The default market offer operates as a price cap and offers up to 27 per cent cheaper are available, depending on location.
Bowen said around 80 per cent of households are not on the cheapest plan and he encouraged people to visit the Energy Made Easy website or energy.gov.au.