The peak body for electricity retailers, the Australian Energy Council, has urged households and business to shop around to make good savings on cheaper market deals following today's increase in regulated electricity prices.
The Australian Energy Regulator's final determination on the Default Market Offer (DMO) will see prices increase between 0.5 and 9.7 per cent from 1 July.
The DMO is designed to be a safety net for around 8 per cent of residential customers and nearly 18 per cent of small businesses who don't look for market deals, which can save people money. The DMO is set for customers in New South Wales, south-east Queensland and South Australia.
The Australian Energy Council's Chief Executive, Louisa Kinnear, said "We continue to see price pressures as a result of the energy transition with the costs of the poles and wires, for generating electricity, as well as retail costs all contributing to price rises.
"That won't be welcome news to households and businesses, but there remain cheaper deals with the regulator pointing to the lowest offers across DMO regions sitting between 18-27 per cent cheaper, which adds up to significant savings.
"It is worthwhile taking the time to contact your retailer to see if you are on their best deal or comparing prices on the independent Energy Made Easy (www.energymadeeasy.gov.au) website.
"Your retailer also has hardship and support programs for people experiencing financial difficulties, so if you are in this situation, contact your retailer as soon as you can," Ms Kinnear said.
The AEC noted that retail margins, which are notably tight, have been kept at last year's level, while the previous competition allowance has been disallowed for the second year. These decisions mean retailers, particularly smaller ones, will continue to face a risky and challenging operating environment.
Retailers play an important role in managing the risk of the entire supply chain to give customers a consistent price during the year. Retail costs include what is known as the cost to serve, which covers billing and IT systems, call centre costs, and hardship programs to support customers. Retail costs also include bad and doubtful debts and the costs of the mandated smart meter rollout, which has recently been accelerated.
About the Australian Energy Council
The Australian Energy Council is the peak industry body for electricity and downstream natural gas businesses operating in the competitive wholesale and retail energy markets. AEC members generate and sell energy to 10 million homes and businesses and are major investors in renewable energy generation. The AEC supports reaching net-zero by 2050 as well as a 55 per cent emissions reduction target by 2035 and is committed to delivering the energy transition for the benefit of consumers.
