Australians are once again bracing for a financial hit, with a new wave of price increases set to impact households and businesses alike. Just as families try to navigate the ongoing cost-of-living crisis, another essential expense is creeping higher—leaving many wondering how much more they can afford to pay.
It’s a harsh reality that’s hitting home for many, especially those already tightening their belts to make ends meet.
The Australian Energy Regulator (AER) has recently released its draft determination for the Default Market Offer (DMO), which sets the maximum price cap for electricity in New South Wales, South Australia, and South East Queensland.
The proposed changes suggest an increase in household power bills ranging from 2.5 to 8.9 per cent, depending on the region. Small businesses are not spared either, with potential hikes between 4.2 and 8.2 per cent.
AER chair Clare Savage acknowledges the tough times for energy consumers, particularly those affected by ex-Tropical Cyclone Alfred, saying, ‘Cost-of-living pressures are front of mind for many households and small businesses.’
The AER has scrutinised the components of the DMO to ensure that the prices reflect the reasonable costs of supplying electricity. Meanwhile, Energy Consumers Australia’s chief executive, Brendan French, expressed disappointment over the price hike.
‘The DMO exists to protect people, particularly those in vulnerable circumstances, from paying disproportionately high electricity prices. If it’s priced up to 25 per cent above more competitive offers, it’s not working effectively,’ Dr French stated.
The Essential Services Commission (ESC) in Victoria has also made its move, recommending a modest average annual increase of 0.72 per cent for electricity costs. This translates to a varied impact on Victorian households, with some seeing a decrease of $19 and others facing a rise of up to $68.
The backdrop to these increases is a stark one. The Australian Council of Social Service (ACOSS) reports that half of Australians are foregoing essentials like food and medication to keep the lights on.
ACOSS chief executive Cassandra Goldie calls it a ‘complete travesty’ that in a wealthy nation like Australia, people are making such sacrifices.
The sting of the price rise is sharpened by the end of government rebates. The federal government’s energy bill relief fund, which provided a $300 rebate to households and a $325 rebate to eligible small businesses, is coming to an end on 1 April.
This rebate helped cushion the blow of electricity costs, which would have otherwise seen a 0.2 per cent increase in December.
As the rebates fade away, Canstar Blue’s survey reveals that 50 per cent of Australians want the support to continue in its current form, while 34 per cent believe it should be ‘means tested.’
Canstar Blue’s director Sally Tindall advises households to prepare for the real cost of their electricity bills by saving the extra cash from the rebates, saying, ‘Tally up your monthly savings and put that extra cash in a safe, warm place ready for when the reality of your real electricity bill bites.’
Moreover, staying loyal to one provider could mean overpaying for electricity. Canstar Blue’s research indicates that Sydney households could save up to $386 a year by switching to a cheaper plan, with Melbourne and Brisbane households potentially saving $319 and $445, respectively.
The message is clear: as the government’s helping hand withdraws, it’s more important than ever for Australians to review their energy plans and seek out the most competitive rates. It’s a time for savvy budgeting and smart decision-making to navigate the rising tide of electricity costs.
We at YourLifeChoices understand the impact these changes can have on the over 50s community. We encourage you to share your experiences and tips on managing electricity costs in the comments below. Have you found a better energy deal? How are you coping with the end of rebates? Your insights could be invaluable to fellow readers facing similar challenges.
Also read: From high bills to huge savings: How one dad beat rising energy costs
That’s what you get with privatisation. The shareholders want more profits.
There once was a program to replace all your down lights with LEDs. Therefore using less energy. I tried to get many electricians to fulfil this work program. This was fruitless as the electricians said it was uneconomic for them, as the rebate from the government was not enough to cover costs.
The best way to reduce your electricity bill is to get rid of the labour government and blackout Bowen at the upcoming election, we can’t cop any more of their idiotic 100% renewalable energy bullshit,its going to send the country broke – idiots they are.