Federal budget 2023: Discounts differ as power relief rolled out

People in Australia’s eastern states stand to benefit the most from the federal government’s $3bn energy relief package jointly funded with the states and territories.

Low-income households in NSW, Victoria, Queensland, South Australia and Tasmania will be eligible for up to $250 in power bill relief from the commonwealth while those in Western Australia, Northern Territory and the ACT will receive $175.

People in Australia’s eastern states stand to benefit the most from the federal government’s $3bn energy relief package jointly funded with the states and territories under one of Labor’s centrepiece cost-of-living measures.

Low-income households in NSW, Victoria, Queensland, South Australia and Tasmania will be eligible for up to $250 in power bill relief from the commonwealth while those in Western Australia, Northern Territory and the ACT will receive $175.

A $325 commonwealth rebate will be available to eligible businesses in each state, translating to a $650 benefit in states that have matched the relief.

NSW, Queensland, WA and SA have fully matched the energy subsidies for households and small businesses, granting households a total of $500 and small businesses $650. WA and the NT have also matched the rebates, with homes and businesses set to receive $350 and $650 respectively.

After months of negotiations with the Albanese government, Victoria and the ACT have opted not to match the commonwealth subsidies, arguing relief already exists via the $250 Power Saving Bonus in Victoria and the ACT’s large-scale feed-in tariff scheme.

Tasmanian low-income households will receive $250 a year for two years, while eligible small businesses will receive $650 in ­relief this year.

The energy relief package will help more than five million households and one million small businesses and will be automatically applied to bills from July 1.

The savings were negotiated in December by the Albanese government and the states as part of a wider government intervention to legislate a cap on gas and black coal prices amid soaring energy prices. The rebates were initially expected to be up and running by April but were delayed after design complexities and disagreements between state and federal governments.

The federal government said the direct energy bill discounts would reduce expected electricity price bill growth by 0.25 per cent and reduce expected retail gas prices by about 0.16 per cent.

Treasury estimates suggest the combination of the $12 gigajoule price cap on gas, the $125-a-tonne cap on black coal and the $3bn in power bill assistance will collectively reduce forecast inflation for 2023-24 by 0.75 per cent.

Jim Chalmers said Labor’s targeted intervention would reduce pressure on household bills, and blamed soaring energy prices on Russia’s invasion of Ukraine and a “decade of energy policy failure” under the former Coalition government.

Gas bills were estimated to spike by 20 per cent in 2023-24, while electricity bills were forecast to rise by 36 per cent last ­November.

“Rising power prices are among the biggest burdens on families and businesses right now,” the Treasurer said. “The energy price relief will take the sting out of power price rises when these increases are expected to be most acute.”

The variation of price relief across jurisdictions is as a result of differing energy prices in each state as well as existing state and territory household subsidy schemes. The rebates will be delivered via energy companies and will be administered by state and territory governments.

Energy and Climate Change Minister Chris Bowen attacked the Coalition after it voted against Labor’s energy relief package for low-income households when parliament was urgently recalled last Christmas.

“The Albanese government acted urgently to protect Australians from the worst of energy price hikes … while Peter Dutton’s Coalition voted against relief,” Mr Bowen said.