Powering up: Experts sound warning as Australian power prices stay shockingly high!

Australians are no strangers to the ever-fluctuating costs of living, and one of the most significant household expenses they grapple with is the electricity bill.

It's a topic that hits close to home for many, especially for those who need to budget carefully.

The recent news from experts about power prices is, therefore, something we all need to pay attention to.


Craig Souter, a single father from Worrigee in Shoalhaven, New South Wales, is one such individual who keeps a vigilant eye on his power costs.

With a mortgage and all the household bills to pay, every dollar counts for him.

‘You're always on the lookout for the best deal,’ he said. ‘And I'll always compare. I'm not loyal… I'm happy to change.’

‘Because I had two boys living at home. We had a pool going, we had tablets on all the time, phones, internet, washing, and long showers by teenage boys, and all those sorts of things,’ he added.


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Despite analysts anticipating a decline in prices, some experts warned that electricity expenses are unlikely to decrease substantially. Credits: Shutterstock


Despite his efforts to find the best deals and his willingness to switch providers, Mr Souter was hit with a severe case of bill shock when his power bill more than doubled from $600 to over $1,400.

This staggering increase came after his supplier, Origin Energy, installed a smart meter at his house.

‘It's a hit, you know, because I earn okay money, but I'd be only earning as much as everybody else,’ Mr Souter remarked.

‘I pay my own mortgage on my own. I pay all my own bills here, like electricity, insurance… everything.’

‘This is my place and I'm paying, so it's a killer,’ he lamented.

A spokesperson from Origin Energy attributed the rise to increased usage, an underestimation of a previous invoice, and a switch to a more expensive plan.


Unfortunately, Mr Souter’s story is not unique in today's electricity market, where prices have surged since the energy crisis two years ago.

The Australian Energy Regulator (AER) and its Victorian counterpart, the Essential Services Commission, set benchmark prices known as default market offers, which act as a cap on what retailers can charge.

While only about 10 per cent of residential customers are on these default offers, they serve as a reference point for other plans.

After a 40 per cent increase in the past two years, there was hope that recent drops in the spot market might bring some relief to consumers.

Certain analysts proposed that prices might decrease by significant ‘double-digit’ percentages.


However, as regulatory bodies prepare to unveil draft determinations for the new benchmark prices, experts expressed uncertainty regarding the outcome.

Josh Stabler, Managing Director at advisory firm Energy Edge, cautioned, ‘I would say that we're going to be plus or minus a few per cent here in terms of the pricing.’

‘This is, despite some rhetoric regarding lower prices in the spot market. I just don't see that passing through to the final calculation on the DMO (Default Market Offer).’

‘Now, this is all just based on the data that we can see in the market. The (AER) will do its own analysis independently, in its own process, and may come to its own conclusions,’ he added.

As per Mr Stabler, although wholesale electricity expenses have decreased from their peak levels, they still remain relatively high.

Additionally, he noted that escalating interest rates and inflation are driving up network expenses—specifically, the costs associated with poles and wires—which typically constitute the largest portion of an electricity bill.


Mr Stabler also highlighted that regulators must take into account projected future wholesale electricity prices when establishing benchmark tariffs for the upcoming year.

He emphasised that these anticipated future wholesale costs, also known as forward wholesale prices, are not anticipated to significantly decrease.

‘Now, when we take a look at what's happened in the last 10, 12 months, the conditions for 2024-25 are generally the same as what they thought in May 2023 for the previous financial year,’ he said.

‘The market conditions for the new financial year aren't substantially different.’

‘They might be 5 per cent below or about even. It's not 20 per cent below, but it's not 20 per cent above,’ he added.


AER Director Justin Oliver shared a similar sentiment, indicating that while the energy crisis of 2022 is mostly behind us, its effects are still lingering.

‘Broadly speaking, we're not anticipating huge movements in either direction,’ Mr Oliver said.

‘It may go up or down depending on where people live.’

‘We're not expecting big increases but we're not necessarily expecting big decreases either at this stage,’ he added.


Jacqueline Crawshaw, Policy Director of Energy Consumers Australia, advised that, regardless of regulatory decisions, the best course of action for consumers is to shop around for the most competitive rates.

‘We're hearing some stories about some of the challenges in the market,’ she acknowledged.

‘But we're also hearing some good stories as well in terms of the wholesale price, which seems to be easing a bit lately. So, we're hopeful that what we'll see is not as bad an outcome as what we've seen over the past couple of years.’

‘The last couple of years we've seen increases of 20 per cent, and that's unsustainable for consumers,’ she added.

For Souter, who is looking towards retirement in six years, the prospect of continuing high electricity costs is daunting.

‘So, if I'm going to be paying that sort of money, that's over $5,000 a year just in electricity. How do you survive? How does anyone survive?’ he asked.


Regardless of the outcome of these changes, you can save money on your energy bills by focusing on things you can control.

First, you have to identify the most contributing factors to your energy bills to adjust accordingly, then you can check out these tips on saving energy and money.
Key Takeaways
  • Craig Souter, a resident of Shoalhaven on the south coast of New South Wales, experienced a more than doubling of his usual power bill, causing significant financial distress.
  • Despite some analysts' expectations of falling prices, experts warned that electricity costs are unlikely to decrease substantially due to various market factors.
  • The Australian Energy Regulator and the Essential Services Commission are preparing to set new benchmark prices, which will not likely offer significant relief to consumers.
  • While the worst price rises might be over, Energy Consumers Australia advised consumers to shop around for the best power deals, as challenges in the energy market persist.
Have you noticed any changes in your energy bills? What are your tips on how to save big on your monthly bill? Let us know in the comments below!
 
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As energy prices have been left solemnly in God's hands, nothing what Labor can do except empty promises.
 
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I was wondering some time ago why there are so many suppliers of power, so i looked at some bills and found the supply charge of up to $1.30 / day and the famous solar rebate from 4 cents / unit being sold at up to 38 cents / unit, if the solar needs service it up to the owner to fix, at crazy prices, talk about cream on the strawberry jam, yet good old Albo two way, never thinks about how to save the population some real money, by checking on these companies that continue to take us to the cleaners, do i sound like a winger, well at 78 yrs i am having a winge, not that the Govt will do anything, cause it might reflect in donations to the party
 
If you put in a Smart Meter you must be smart in how you use electricity. I have changed my routine since putting in one of these meters so that I cook when the price is in middle range not at high range when everyone else is cooking. I do my washing either between 10pm & 7am or at weekends only when the price is at its lowest. The same for ironing. By being smart it is possible to reduce the amount you pay for electricity even though it is still really overpriced since there is no cost to produce it compared with the cost of coal & electricity in the days when we had coal fired power stations. The cost is in buying & installing hundreds of solar panels & wind turbines covering hundreds if not thousands of acres of reclaimed farm land when we could have built new coal fired or nuclear power stations for
 
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I feel every one is missing the point if government have to subsidise the consumer by giving rebates and have to help energy providers when they look like they are going to close power stations than why haven’t the governments bought back the power companies so it’s back in the tax payers hands
Because all their doing is pouring money into companies so they can pay shareholders and the consumers are footing the bill
 
My energy supplier is a small boutique style operation called Energy Locals. They are just great. I got a bill yesterday and was unsure about a few things and so I got on the phone and spoke with a wonderful lady called Nev who was absolutely nothing but helpful, patient, calming and an absolute delight to speak to. I am at best a bit growly with these situations but Nev was an absolute sweetheart and put my worries to rest. They have a policy of selling power to their consumers at cost but they charge a fixed fee which is not huge and that is where they make their profits. I cannot recommend them highly enough so if you are comparing then I would urge you to give Energy Locals a go.
 
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I would love to know how many millions we pay in bonus's for the lazy effin CEO's who sit on their arses all day collecting money for nothing. These greedy bastards are already over paid and under worked just like our dipshit PM who gave himself a payrise and bonus for giving with one hand and then takes it back with 2 hands. We, the consumers pay for this filthy greed and we need a government that will put a stop this bullshit and Labor just ain't cutting it, just like they aren't earning their overpaid salary.
 
I was never asked if I wanted the so called smart metre. How I found out was I came back home from being out most of the day and someone was working on my metre box. I asked what are they doing, all they said was a WiFi was being installed for my metre and that a metre reader would no longer be sent to my home. Funniest thing was they didn't even tell their metre reader who came to my home to read the metre a few weeks later. So, when the next bill arrived that's when all the trouble started. Stupid me though it was just the way they changed how they would bill me (change over date) and that the next bill would see my credit returned to me. But low & behold that was not the case. See what they did was totally change the plan I agreed too “Origin Advantage Variable XL” to “Origin Easy” but still telling me I was on the best plan. Not once did anyone let me know I would need to increase the amount of fortnightly payments. So, I was taken off a 13% plan and put on a 7% plan. So, now I've lost over $800.00 that my account was in credit that I can never get back. I'm even using over 12% less electricity per quarter. Am not a happy long term customer. I will be looking at every bill with a fine tooth comb from now on, plus my son is going to check things for me as well.
 
I was never asked if I wanted the so called smart metre. How I found out was I came back home from being out most of the day and someone was working on my metre box. I asked what are they doing, all they said was a WiFi was being installed for my metre and that a metre reader would no longer be sent to my home. Funniest thing was they didn't even tell their metre reader who came to my home to read the metre a few weeks later. So, when the next bill arrived that's when all the trouble started. Stupid me though it was just the way they changed how they would bill me (change over date) and that the next bill would see my credit returned to me. But low & behold that was not the case. See what they did was totally change the plan I agreed too “Origin Advantage Variable XL” to “Origin Easy” but still telling me I was on the best plan. Not once did anyone let me know I would need to increase the amount of fortnightly payments. So, I was taken off a 13% plan and put on a 7% plan. So, now I've lost over $800.00 that my account was in credit that I can never get back. I'm even using over 12% less electricity per quarter. Am not a happy long term customer. I will be looking at every bill with a fine tooth comb from now on, plus my son is going to check things for me as well.
This doesn't sound right.
In my experience, when plans are changed over they must have your acknowledgement, usually over the phone.
I reckon you have grounds to seek retribution, repayment, and perhaps compensation. Look to an ombudsman after gathering all your paperwork. They can get results.
 
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My energy supplier is a small boutique style operation called Energy Locals. They are just great. I got a bill yesterday and was unsure about a few things and so I got on the phone and spoke with a wonderful lady called Nev who was absolutely nothing but helpful, patient, calming and an absolute delight to speak to. I am at best a bit growly with these situations but Nev was an absolute sweetheart and put my worries to rest. They have a policy of selling power to their consumers at cost but they charge a fixed fee which is not huge and that is where they make their profits. I cannot recommend them highly enough so if you are comparing then I would urge you to give Energy Locals a go.
I've been trying (and failing) to get a quote on their website. They don't cover WA or NT, but you have to work that out for yourself. I do wish businesses that only trade in certain areas would make that fact clear at the beginning 😡
 
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We just received our latest power bill $776.00, we have never been billed this high and we have solar panels and solar hot water. My husband was dependant on the AC this year because the humidity was wiping him out. Friends in NSW got their bill for $900 odd and they too have solar panels. We never had a bill over $400, what do I do, put on more panels, install a battery, get rid of the husband?
These new added expenses are blowing our budgets out of the water. There is no fudge factor left, if the rest of the year is like this we can say goodbye to all of our little luxuries and treats for grandchildren 🥵 :eek:
 
I've been trying (and failing) to get a quote on their website. They don't cover WA or NT, but you have to work that out for yourself. I do wish businesses that only trade in certain areas would make that fact clear at the beginning 😡
Sorry about that, I should have realised that. I hope it did not cause you too much grief.
 
Even more reason it should all be put back in the government hands and owned and run by tax payers take it out of the private sector
 

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