Households right across the country will experience a 19.6 per cent to 24.9 per cent price hike on their electricity bills from July 1.
The Australian Energy Regulator (AER) handed down its final decision on Thursday morning, a slightly higher increase than its 19.5-23.7 per cent estimate in the draft default market offer (DMO) in March.
Despite the rise, the AER said it’s about half the hike that could have incurred if the Federal Government hadn’t stepped in.
Price increases could have reached 50 per cent in the government hadn’t imposed price caps on gas and black coal in December 2022.
The 19.6-24.9 per cent increase will be felt by residents in New South Wales, South Australia, and south-east Queensland. In Victoria, a 25 per cent increase will occur.
Speaking to The Australian Financial Review, AER chairwoman Clare Savage defended the price hike, describing it as a “difficult balance” between protecting customers and allowing retailers to recoup costs.
“It is obviously a very difficult decision, and no-one wants to put up prices as you can imagine,” Ms Savage said.
“The DMO is a protection against unjustifiably high prices, but our job is to make sure retailers can also recover their costs. But I think we have struck that right balance.”
The AER said wholesale energy costs account for about a third of final bills and remain “the predominant driver of increased retail electricity prices”.
Any state and federal bill relief measures will be what support customers feeling the pressure in the wallets with the increases.
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