Australia has long been known as the “lucky country” but it will soon have to drop the moniker after it has been revealed we are paying the highest electricity prices in the world.
In fact, residential customers are paying two to three times more than American households with South Australian households the worst off.
The Australian Financial Review reported that South Australians were paying 47.13¢ per kilowatt hour following the price hike on July 1 – that’s more than Germany, Denmark and Italy – all of which heavily tax energy.
Australia previously had the lowest retail prices in the world along with the US and Canada when the eastern states’ National Electricity Market was formed in the last 1990s says CME director Bruce Mountain.
In a bid to understand why energy retailers were charging so much compared to the rest of the world, Prime Minister Malcolm Turnbull has summoned energy retailer chief executives to Canberra next week to explain themselves.
Last year, AGL Energy chief executive Andy Vesey admitted that big power companies did in fact punish their most loyal customers by luring them in with discounts but after a year or two, put them onto a much most costly offer or a much smaller discount.
And last week, Australian Competition and Consumer Commission chairman Rod Sims said he wanted to help ease the energy crisis by helping consumers find “much cheaper” electricity.
Sims said the agency was concerned most for the poor and elderly as they were often left on high-priced “standing offers” and that AGL, Origin Energy and EnergyAustralia had little motivation to drop their prices or open the market for new retailers.
Carbon + Energy Markets’ MarkIntell data service shows NSW households on average pay 39.1¢/KWh which is almost as much as Italy pays (40.1¢/KWh ).
Meanwhile, Queensland and Victoria’s typical charges of 34-7c-35.7c/KWh are much higher than most countries save four or five of the most expensive European ones.
And when taxes aren’t included, residents of South Australia, NSW, Queensland and Victoria pay the highest residential electricity in the world.
When compared to American households – who pay just US12.5c/KWh(15.75¢) as it enjoys a large market and low-priced natural gas which there’s plenty of – it seems Australia is sadly no longer the “lucky country”.