Power up to $200 dearer in NSW since re-regulation, Australian Energy Regulator report shows
Big power companies have hiked their cheapest deals by as much as nine per cent since re-regulation, potentially adding hundreds of dollars a year to families’ costs.
NSW
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The first official data on the impact of the federal government’s power price re-regulation reveals big power companies have hiked their cheapest deals by as much as nine per cent, potentially adding hundreds of dollars a year to families’ costs.
And the worst-hit areas of the nation are western Sydney and regional NSW.
The Australian Energy Regulator (AER) research which identifies the increases also explains the reason — retailers are recouping losses from the introduction of the default market offer (DMO) on July 1.
The DMO bans the very highest tariffs, paid by people who have never bothered to shop around.
The AER’s research finds AGL, EnergyAustralia and Origin raised the prices of their least expensive deals by at least six per cent and up to nine per cent between June and July.
It means a family in Blacktown or Wagga Wagga who seek out the most affordable tariff today would be up for as much $200 extra compared with what they would have paid on the cheapest plan in the market last year. That’s based on using 7000 kilowatt hours annually.
The AER’s research has emerged after The Daily Telegraph reported analysis commissioned by St Vincent de Paul found second-tier retailers’ lowest offers were as much as $400 more dearer than 12 months earlier.
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The AER research is more in-depth and hones in on what the dominant retailers are doing. About 70 per cent of all households are with the big three.
The largest increase the AER identified was in the Endeavour distribution area, which covers the western half of Sydney, Blue Mountains and Shoalhaven.
Despite the best prices now being less attractive, AER chairwoman Paula Conboy urged customers to shop around, saying it was the “key tool” at the public’s disposal to reduce energy spend at a time of “restricted income growth”.
Research by NAB shows the cost of living is the public’s biggest source of anxiety, with one in four people rating their level of concern as “very high” in the three months to the end of June.
A separate survey by consumer group Choice published two weeks ago showed electricity prices were a major headache for 80 per cent of people and that two-thirds of households were either just getting by or struggling to get by on their current incomes.
There is good news in the AER research. There is more money to be saved now for small businesses in the Endeavour zone and the Essential patch, which covers most of regional NSW.
The AER also found the DMO is reducing bills for the small minority of NSW households that have been automatically moved onto it since July because they’ve never switched provider.
For those moved to the DMO there is set to be an average reduction of $181 a year in the Essential area and $175 in the Endeavour region.
In the Ausgrid zone — which covers the eastern half of Sydney, Central Coast and the Hunter Region — the typical bill drop from being switched to the DMO will be $129.
Federal Energy Minister Angus Taylor said the AER research showed the DMO had capped prices.
“The Government welcomes the findings while acknowledging there is more to be done to help Australian households and small businesses get a fairer deal,” he said.