Consumers and small businesses in NSW, Queensland and South Australia face substantial electricity price rises after the Australian Energy Regulator (AER) revealed its final determination on default market offers today.
In a release strangely withheld until after the election, the AER announced:
- NSW households will face increases of between 8.5% and 18.3%
- South-east Queensland households will see increases of between 11.3% and 12.6%
- South Australian households face increases of between 7.2% and 9.5%
- Prices for NSW small businesses will rise 10%-19.7%
- Businesses in south-east Queensland prices will be charged 12.8% more
- South Australian businesses’ prices will be just above inflation (5.7%).
The Victoria Default Offer determination, released on Tuesday, has set a 4.5% average price rise in that state (which uses non-exported brown coal), but in some cases up to 10%.
As Crikey reported last week, NSW and south-east Queensland consumers are particularly vulnerable to the surging global thermal coal price, driven by the invasion of Ukraine, because they rely on black coal. But the unreliability of coal-fired power has also been a key factor:
… a reduction in thermal generation resulting from unplanned outages and higher coal and gas costs, slowing of investment in new capacity, and increasingly ‘peaky’ demand driving up the cost of hedging for retailers. These conditions have persisted and been compounded by the ongoing war in Ukraine, which has led to significant pressure on coal and gas prices globally; extreme weather in NSW and Queensland, which has affected coal supplies and electricity demand; and further unplanned outages at multiple generators. As a result, there have been very significant increases in wholesale futures prices for all DMO regions but in particular NSW and Queensland.
It’s now clear why Angus Taylor and Scott Morrison changed regulations to prevent the AER from revealing its determination during the election campaign — it would have smashed their claim that electricity prices had fallen under the Coalition, and reinforced Labor’s successful campaign to focus on the soaring cost of living.
It would also have highlighted the very real consequences for households and small businesses of the Morrison-Taylor agenda to keep the east coast power grid anchored to coal-fired power, with Taylor angrily attacking any suggestion expensive and unreliable coal should be phased out more rapidly, and of a lost decade in climate policy that commenced when Tony Abbott was elected in 2013.
The ensuing lack of a coherent energy policy, and the massive impact in deterring investment in renewables, has left the east coast poorly prepared for a sudden surge in fossil fuel prices.
Households — once promised a cut in electricity costs with the abolition of the carbon price in 2014 — face paying hundreds of dollars more a year because of the Coalition’s climate denialism.
Meanwhile, coal companies wallow in massive profits. Today NSW and Queensland coalminer New Hope revealed that in the three months to April it earned a pre-tax profit of $358.6 million for the quarter “following further strengthening of coal prices”, taking its nine-month pre-tax profit to a record $913 million.
Other coalminers such as Glencore (which settled corruption charges this week), Whitehaven and Chinese-owned Yancoal are also making huge windfall profits totalling billions of dollars.
Treasurer Jim Chalmers and Finance Minister Katy Gallagher must surely be considering a fossil fuel superprofits tax given the massive impacts on household and small business budgets in NSW, Queensland and South Australia.
For a long time, the impact of the federal Liberals’ inability to take climate seriously was thought to be on Australia’s emissions and our level of renewables investment. But now it’s set to have a very real impact on household budgets at a time of serious inflation. There’s speculation that Taylor will emerge as Treasury spokesman in a Dutton-led opposition. You can be sure that the government will make sure Taylor is held responsible for every single electricity price rise to come.
You can be sure that the government will make sure Taylor is held responsible for every single electricity price rise to come. – let’s hope so – and let’s hope the MSM passes the message on to voters
How?
Take it out of his Parliamentary Superannuation contributions?
Angus Taylor as Treasury spokesman? Did I read that correctly? The bloke could barely use an abacus.
He’s very good at cooking the books, though, which is a core skill for a Liberal treasurer.
I’m sure NewsCorp will be crowing: told ya so! Power prices surging as soon as Labor voted in. Except I don’t think anyone actually buys their BS given they went all in against Labor and no one listened to them.
Dutton on RN Friday morning talking about the need to protect consumers from rising electricity prices – the ones concealed pre election?
Not only do the fossil fuel companies make millions thanks to high commodity prices at the moment, they also save millions via not paying fuel excise tax and almost all of them pay no, or next to nothing in company tax and pathetically low royalties (royalties are not categorised as a “tax” but the companies try to paint them as such).
Bowen already hammering this home. Good.
As Grumble said yesterday, this government must relentlessly prosecute every sin, every lie, every instance of corruption and the whole gamut of incompetence of the coalition over the past decade. Australians must be made to understand the calamity left again to Labor. The coalition (if it survives the toxin of the Beetrooter) must be kept off the treasury benches until every current coalition member has been purged and replaced by a human.
Indeed. After the plethora stagey royal commissions and other inquiries used to smear Shorten, Gillard, Rudd and the unions, the tories have earned a vigorous return of what they served up while in government. A Murray-Darling water rorts inquiry would be an entertaining outing for the Beetrooter for a start.
This is a good summary of where the Coalition has been so wrong on renewable energy. They have their eyes on protecting the profits of industries being phased out instead of grasping the need for giving our children and grandchildren some reprieve from the threatened effects of global warming . These backward looking people have no idea that we no longer need fossil fuels for firming the national grid. We can rely on interconnections in the grid and batteries. For refined control of the grid we already have lithium batteries large and small and we also have gravity batteries. Where feasible we can have pumped hydro gravity batteries and elsewhere, even in urban areas we can have raised solid mass batteries, using raised earth or green concrete masses to hold the energy, which then can generate electricity by being lowered, just as hybrid or electric cars generate power as they go downhill. The cave dwellers that Morrison claimed were alive and living in WA were really alive and sitting in the Federal Coalition parliamentary seats. Now many but not all of them are gone and we have a new government, we have a new government that can start providing power for a bearable future for our children and grandchildren and might, by the next election, find that their projects can be taken further so that we have at least 60% reduction in Greenhouse gases by 2030.
Well Ian, those political donations don’t come from thin air, don’t you know…?
I don’t know what you intend to say. Like most people, I took it for granted that Coalition politicians did not want to preserve fossil fuel profits simply because they liked the look of these companies. You might simply want to say no one should be any less surprised than I am that business donations influence Coalition politicians and I agree. You might want to say that I overlooked those donations and how they settle the question of which cave the Coalition should settle in. I didn’t overlook them. Should we still expect to have cheap cigarettes, because donations from tobacco companies don’t come from thin air? The cave dwellers, of course, took their time to feel they had to leave high taxes on cigarettes, even when they had the power to change them. Nevertheless, after taking that time, they now must leave them in place. They will also not try to undo the changes that the new ALP government will bring in, even if they return to power, since enough of them know that Sky after dark luminaries will stay in the dark.