AGL cuts power prices but hikes gas
AGL Energy will cut electricity prices for households in NSW from July 1 but gas prices will jump a whopping 1.8 per cent.
NSW
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STINGY AGL Energy has dudded thousands of NSW families seeking some power bill respite by reducing electricity prices by a paltry 0.3 per cent from July 1. That equates to about $1.25 per quarter for the average household.
At the same time the energy giant, which is on track to post a $1.04 billion profit this year, will hike gas prices for NSW households by 1.8 per cent.
Small business customers’ gas prices will be increased by an average of 2.5 per cent while their electricity prices will be reduced by just 0.1 per cent.
“We understand power prices have been high and that has put pressure on many households,” AGL chief customer officer Melissa Reynolds said yesterday.
“While these price cuts are slight, they’re part of a downward trend that is emerging as more investment in new sources of supply comes into the market.”
Rival Origin Energy cut prices earlier this week for Queensland and South Australia but left prices stable in NSW and ACT.
And in a further blow to NSW households, the price drops announced yesterday by AGL were much lower than analysts at the Australian Energy Market Commission had forecast.
A 2017 AEMC report predicted residential prices would fall by 5.8 per cent in NSW in 2018-19 as new solar and wind-generated power fed into the grid.
Energy Minister Josh Frydenberg said the price reductions this week were “modest” but a step in the right direction for consumers.
“Welcome modest price relief from AGL Energy for its electricity customers in QLD, NSW & SA,” he tweeted.
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“Coupled with reductions from Origin Energy it is further evidence we have turned a corner on power prices.”
Ms Reynolds said AGL’s prices could fall further if there was greater policy certainty to encourage investment into new power stations.
“AGL supports the policy certainty that would come with implementation of the national energy guarantee,” she said.
Energy Consumers Australia CEO Rosemary Sinclair said while the cuts were welcome they were on the “low end” of what retailers could afford to deliver.
“There is clearly an opportunity here for market differentiation if other retailers decide to offer bigger savings to households and small businesses,” she said.
“With the costs of gas and electricity generation and managing the poles and wires falling in many places, consumers are expecting to see prices coming back down to more normal levels, having lived with 30 per cent price increases in the past two years.”
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