Title: Brace for Impact: Energy Bills Set to Rise by Hundreds of Dollars per Year
Introduction:
Winter is coming, and with it come rising temperatures. The onset of colder weather means a surge in energy consumption for many households. As if the pandemic and economic crisis weren’t enough, households in New South Wales, South Australia, Victoria, and Queensland are set to face higher energy costs than ever before. In this article, we analyze the rising cost of energy in Australia, why prices are increasing, and how it will impact households, businesses, and the Australian economy.
Body:
Why Energy Costs are Rising?
Wholesale electricity prices have soared in Australia over the past year, largely due to rising gas prices. The surge in gas prices is attributed to the increase in demand, especially from emerging export markets such as Japan and South Korea. Another factor driving up prices is the closure of coal-fired power plants and the shift to cleaner energy sources, including renewables. While the transition to cleaner energy sources is a positive step, it comes at a cost.
Energy Retailers Confirm Bill Increases
Two of Australia’s major energy retailers, AGL and Origin Energy, have confirmed that they will pass on higher costs to customers with variable rate market contracts. Residential property price increases will range from 21% to almost 30%. Smaller businesses, too, will face a price increase, with Origin Energy revealing that businesses in Victoria would experience cost increases of approximately $590, $705 in Queensland, $918 in New South Wales, and $1,133 in South Australia. The onset of the COVID-19 pandemic provided temporary relief from rising energy prices, as public health measures and work from home orders meant that many households did not use as much energy. However, as the restrictions start to ease and people return to work, energy usage is set to rise, leading to higher bills for households and businesses alike.
Effects of the Energy Price Rise
The cost of energy is one of the biggest household expenses, and the rising cost of energy would undoubtedly put a strain on family budgets. Uniting Communities chief executive, Simon Schrapel, raised concerns about the impact of price hikes on low-income households. “That is our main concern; we know that people are finding it very difficult,” he said. The price increase would also impact small businesses still reeling from the impact of the COVID-19 pandemic.
Measures to Mitigate the Impact of Energy Price Increases
AGL and Origin Energy have announced measures to protect their most vulnerable customers from the impact of price increases. Origin Energy General Manager of Brand and Customer Experience Catherine Anderson said the company would “absorb the price change” for customers in its Power On hardship program. AGL also announced that eligible customers in its Staying Connected hardship program would receive up to $400 in bill credits in the winter term, to minimize the impact of price increases. Both retailers encouraged customers having difficulties paying their bills to contact them for help.
Additional Piece:
While the measures announced by AGL and Origin Energy are a welcome relief, the reality is that the rising cost of energy is likely to put more pressure on Australians already grappling with the economic fallout of the COVID-19 pandemic. According to the Australian Bureau of Statistics (ABS), in 2020, 29% of Australian households reduced their energy consumption because of financial stress, with 5.6% of households experiencing some form of energy disconnection. With energy prices set to increase sharply, it is expected that an even higher percentage of households will reduce their energy consumption, with more facing disconnection.
Moreover, the Australian economy also risks being impacted by the rising cost of energy. With the country heavily reliant on exports, the cost of production is a major determinant of competitiveness in global markets. According to a report by the Australian Industry Group (AIG), energy costs already ranked third amongst manufacturing businesses’ biggest cost impacts, behind wages and raw materials. The report further revealed that a 1% increase in gas costs led to a 0.25% decrease in output.
The rising cost of energy highlights the need for Australia to invest in renewable energy sources such as solar and wind. In doing so, Australia can reduce its reliance on fossil fuels and become a low-carbon economy that aligns with the global trend towards sustainability. A recent report by the International Energy Agency (IEA) showed that renewables could provide more than 50% of global electricity as early as 2025, overtaking coal. By embracing clean energy, Australia could reduce its reliance on imports, support job creation, and reduce the impact of climate change.
Summary:
The rising cost of energy in Australia is set to impact households, small businesses, and the economy at large. Wholesale electricity prices have surged, driven largely by rising gas prices. AGL and Origin Energy have confirmed that prices will rise between 20 and 29%, with smaller businesses, too, set to face a price increase. The impact of rising energy prices on low-income households and small businesses is a major cause of concern. Both AGL and Origin Energy have announced measures to mitigate the impact of energy price increases. Nevertheless, Australians need to embrace clean energy sources to reduce reliance on fossil fuels and reduce the country’s carbon footprint. With the right policies and investments, Australia can become a low-carbon economy that supports job creation and helps to reduce the impact of climate change.
—————————————————-
| Article | Link |
|---|---|
| UK Artful Impressions | Premiere Etsy Store |
| Sponsored Content | View |
| 90’s Rock Band Review | View |
| Ted Lasso’s MacBook Guide | View |
| Nature’s Secret to More Energy | View |
| Ancient Recipe for Weight Loss | View |
| MacBook Air i3 vs i5 | View |
| You Need a VPN in 2023 – Liberty Shield | View |
The cost of keeping homes warm this winter is about to rise, and two major energy retailers confirm that bills will soon climb hundreds of dollars a year.
Key points:
- AGL and Origin Energy announce energy price increases
- Prices will rise between 20 and 29 percent from July and August
- Retailers say rising wholesale electricity prices are the main culprit
AGL and Origin Energy announced that they will pass through higher prices due to inflation and higher wholesale costs to customers with variable rate market contracts.
The changes will come into effect in New South Wales, South Australia and Queensland from July 1 and in Victoria from August 1.
Residential property price increases range from 21% to nearly 30%.
|
Median Price Increases for Residential Customers on Variable Rate Market Contracts |
||||
|---|---|---|---|---|
|
New south Wales |
vic |
queensland |
SA |
|
|
AGL |
$540 (29.7%) |
$341 (25.5%) |
$447 (26.4%) |
$565 (29.8%) |
|
source energy |
$407 (21.1%) |
$361 (25.5%) |
$347 (21.6%) |
$405 (24.2%) |
Queensland retiree Linda Rhule said she was “very concerned and worried” about a price increase.
She said that she would use less of her heating during the winter to try to reduce her energy use.
“We’re going to go through some tough times, I can see some tough times ahead,” he said.
“It’s the same for everyone, not just us.”
Uniting Communities chief executive Simon Schrapel said he was concerned about the impact of price increases on low-income households.
“That is our main concern, we know that people are making it very difficult,” he said.
However, both AGL and Origin said they would implement measures to help protect their most vulnerable customers from price increases.
Origin Energy general manager of brand and customer experience Catherine Anderson said the company would “absorb the price change” for customers in its Power On hardship program.
“So we can help protect them at a time when we know budgets are already tough,” he said.
AGL said eligible customers in its Staying Connected hardship program will receive up to $400 in bill credits in the winter term to minimize the impact of price increases.
Both retailers encouraged anyone who is having difficulty paying their bills to contact them for help.
Small businesses will also face a price increase, with Origin Energy describing an average increase of $590 in Victoria, $705 in Queensland, $918 in New South Wales and $1,133 in South Australia.
Kate Furness, an Adelaide small business owner who recently bought her own home, said rising prices at both work and home were a constant concern.
“It’s in the back of your mind all the time, it’s a concern,” he said.
The sole trader said he was now considering renting out his newly purchased home to help cover costs.
“I’m happy to sleep in my booty if it comes down to it, but it’s not ideal,” he said.
“And in terms of running a food business, the priority is putting all the money and finances into quality control and safety and everything to get it done.”
South Australian bakery owner John said he has already had to make tough decisions to keep up with rising business costs.
He said he had to close the storefronts and lay off the staff because “it was costing us too much.”
“Instead of 10 employees, we only have four,” he said.
This article contains content that is only available on the web version.
If you can’t load the form, click here.
https://amp.abc.net.au/article/102465710
—————————————————-