The Australian Bureau of Statistics (ABS) revealed average energy costs per household have notably decreased by 6.2% over the 12 months to June 2016. This translates to the average Australian household saving over $300 each year on their energy bill.
However not all is well, with electricity prices sparking alarm bells around the country. Accounting for a third of the average household energy bill, the Australian Energy Regulator (AER) reported wholesale electricity prices increased in every National Electricity Market (NEM) region during the 12 months to June 2016 with Queensland, South Australia and Tasmania being the worst hit.
While the cause of these price rises is difficult to identify, differing according to each geographic location, a primary determinant of prices is the supply and demand equation. The closure of Alinta’s Northern Power Station in 2016 resulted in a restricted supply of energy. According to the AER’s State of the Energy Market report, the reduction in electricity supply meant gas fired generation was influencing the dispatch price more often than usual—at a time when gas fuel costs were extremely high.