Household electricity costs have plummeted over the past year with Aussie households savings around $65 per bill, a new report has found.
The latest Australian Competition and Consumer Commission (ACCC) report has revealed a drop in prices throughout 2018-19 with Australians paying an average of $1,509. However, while this sounds like good news, costs are still $254 higher than they were in 2007-08.
Environmental costs have been signalled out as the biggest driving factor behind the increase in average household bills since 2008. This is due to the federal and state government’s policies which are aimed at encouraging greater uptake of renewable generation and promoting energy efficiency and reducing carbon emissions.
According to the ACCC, many of these policies result in additional costs for retailers that ultimately flow through a customers’ electricity bills, unless they are funded through other means.
The costs of such schemes accounted for $103 of the long-term increase in household bills between 2007–08 and 2018–19. For example, the average household pays around $550 a year more than a household with solar panels, a situation the ACCC believes raises significant questions about fairness.
“The cost of installing solar panels has reduced significantly in recent years, so environmental schemes like the premium FiT rebates are no longer needed to make solar an attractive option for those households that can afford it,” ACCC Chair Rod Sims said.
“Indeed, all customers who can, should consider how much they could save by installing solar panels. We are primarily concerned about the additional costs such schemes have imposed on households that cannot access or afford to install solar panels.”
However, there is good news on the horizon for Aussies with the reforms to retailer pricing, which were implemented on July 1 this year, expected to further cut costs of electricity for around 900,000 customers in South Australia, New South Wales, south-east Queensland and Victoria in the coming year.
According to the ACCC’s report, residents in these areas can expect to save between $152 and $455. But even if you don’t live in these states, Sims said there are still savings to be made by simply switching providers.
He said several smaller retailers are offering cheaper prices than the big three retailers – AGL, EnergyAustralia and Origin.
“Households can find an even better deal by shopping around and looking at the offers of some of the smaller retailers in the market,” Sims explained.