NSW electricity prices predicted to fall
ELECTRICITY prices in NSW are tipped to fall by 6.9% on average from 2015 when Australia's carbon price links to the floating European market.
The Independent Pricing and Regulatory Tribunal made the prediction on Monday as it revealed electricity prices would rise by an average of 1.7% from next month.
Lower market costs of electricity, relatively stable green scheme costs, lower inflation and lower network charges led to the reduction in average prices from 3% to 1.7% in the two months between IPART's draft and final reports.
Country Energy customers will actually see their prices fall by 0.7% from July 1.
It comes less than a month after Queensland consumers were told their electricity bills would skyrocket by as much as 22.6% from next month.
After years of significant electricity price rises, consumers will take heart from IPART's prediction that the "likely direction of future prices is down".
It is predicting another rise of about 2% from July 1 next year followed by an almost 7% drop a year later - a more substantial fall than indicated in IPART's draft report in April because of significant falls in the price of European carbon permits.
The price for Country Energy customers is tipped to rise by 1.8% next year before falling by 6.2% in 2015.
But the news was not all good, with the price of gas set to rise by an average of 8.5% from July 1, with IPART chairman Peter Boxall describing the future of gas prices as "unclear".
Regulated electricity and gas prices apply only to customers who have not taken up a competitive market offer. In NSW, 60% of electricity consumers and 70% of gas consumers are on competitive offers which are generally lower than the regulated price.
A spokesman for federal Climate Change Minister Greg Combet said IPART's decision was "good news for NSW households", particularly those with Country Energy.
He claimed the decision was a signal the Federal Government's reforms in the national electricity market were beginning to flow through to households.
"Network costs have been the main reason why electricity prices have risen in recent years, with a total rise of $580 a year since 2007-08 for the typical NSW household," the spokesman said.
The spokesman also seized on IPART's description of last year's carbon price increase as a "one-off effect", arguing it was proof the impact of the scheme on electricity was around $3.30 per week for the average household customer.
"The carbon price is already working to reduce pollution, with emissions in the National Electricity Market down by 7.4% and renewable energy output up almost 30% in the first 11 months," he said.
RISES BY COMPANY
- A 3.2% increase from July 1 - an extra $1.20 per week ($63pa) on an average residential customer bill (bringing
the total average annual bill to $2012), and $1.70 per week ($88pa) on average for its small business customers (bringing the total average annual bill to $2815).
- A 1.3% increase from July 1 - an extra 45 cents per week ($24pa) on an average residential customer bill (bringing
the total average annual bill to $1880), and 65 cents per week ($34pa) on an average small business customer bill (bringing the total average annual bill to $2630).
- A 0.7% decrease from July 1 - a reduction of 30 cents per week ($17pa) on an average residential customer bill (bringing the total average annual bill to $2416), and 45 cents per week ($23pa) on average for its small business customers (bringing the total average annual bill to $3378).
* IPART operates a free electricity and gas online price comparison service that lets consumers compare offers from energy retailers in NSW. For consumers who need help using myenergyoffers, a free phone service is maintained by the Department of Trade and Investment, Regional Infrastructure and Services and is available on 1300 136 888.