Bill slug adds extra pain as power costs soar

RAPIDLY rising gas prices are set to wipe out savings on electricity bills next year.

AGL's Mark Brownfield with energy-saving technologies Picture : Adam Elwood

RAPIDLY rising gas prices are set to wipe out savings on electricity bills next year.

Major energy retailer AGL said annual average household gas bills would jump by ­between $81 and $87, mainly because of a higher wholesale gas cost, from January 18.

Gas prices are rising five times faster than inflation.

But electricity bills are set to shrink between $65 to $76 as lower distribution and ­smartmeter charges are passed on to consumers.

The power price drop is the first since the carbon tax was axed on July 1 last year.

“Exact impacts will vary based on a customer’s tariff type, usage, the area they live in and their existing energy plan,” AGL marketing and ­retail customers general manager Mark Brownfield said.

Vinnies energy expert Gavin Dufty estimated some households would cop gas rises as high as $120, while electricity cuts would range from about $30 to $150.

AGL has about one million Victorian gas and electricity household customers.

Gas market offers, which most customers are on, will ­increase by an average of 7.3 per cent, while those on default standing offers, usually the most expensive on the market, will see a 7.6 per cent rise. Electricity costs will drop 4.4 to 4.5 per cent on average.

Concession card holders on standing offers will have an extra 10 per cent automatically discounted from their electricity consumption rates, but not fixed charges.

Rival EnergyAustralia has already confirmed 5.5 to 5.8 per cent annual gas bill increases for average customers from New Year’s Day.

It is still reviewing electricity changes.

The Herald Sun this month reported the State Government had set up a committee to handle a gas price crisis as exports expanded.

The Australian Energy Market Operator has forecast rising local gas prices as growing volumes are sent overseas, but its report released in April downplayed fears of short-term shortages in east coast states because commercial and residential demand was easing.

The Australian Competition and Consumer Commission is probing if ­insuf­ficient competition is driving up wholesale gas prices.

[e-mail]

@KarenCollierHS