Ergon Energy has unveiled its Pricing Proposal Overview for the upcoming financial year, bringing some rather unwelcome news for households and businesses across Queensland.
Starting July 1, electricity prices for both residential and commercial customers will increase by 13.4% to 13.7%, based on current kW usage charges.
For homeowners and small businesses, this translates to an increase ranging from $112 to $232 per quarter.
Larger commercial enterprises connected to a low-voltage network could see their costs surge by up to $4,734 per quarter.
Currently, the average Queensland household spends between $200 and $300 per month on electricity, or $600 to $900 per quarter. Under the new rates, a quarterly bill of $600 would rise to $690 - $700.
These price hikes come at a time when many consumers are already struggling with rising living costs.
But what is driving these increases?
The Factors Behind Rising Electricity Prices
Several factors contribute to the rising electricity costs.
One significant issue is the increased network costs and the unreliability of coal-fired power plants.
And despite a decrease in wholesale power prices due to the shift towards renewable energy since 2022, consumers are facing higher charges.
Coal-fired power stations are not operating at peak efficiency in QLD, and global coal and gas prices are escalating.
This situation forces retailers, including Ergon Energy, to raise prices to mitigate "increased risk." In Queensland, the frequent breakdowns at the Callide C coal plant near Biloela exacerbate this issue, leading to reduced supply and higher costs.
The Australian Energy Regulator (AER) considers several factors when determining yearly costs: Wholesale costs, Network costs, Retailer participation in governmental environmental schemes, and Retail operations costs.
These combined pressures ultimately result in higher prices for consumers.
Potential Solutions for Consumers
As Australia continues to invest in renewable energy at the governmental level, similar opportunities exist for residential and commercial consumers.
According to the University of NSW, approximately 5.7 million Australian homes still lack rooftop solar panels, representing a significant opportunity to combat rising electricity costs.
Installing solar panels on every residential rooftop would cost an estimated $9.8 billion annually over five years, with the investment paying off in approximately 5.3 years.
In Queensland, while the transition to solar and wind energy is crucial, gas and coal-fired power stations remain necessary for essential services like hospitals until renewable energy can fully meet the demand.
What This Means for Regional Queensland Consumers
For those in regional Queensland, now is the time to consider switching to solar energy.
If you haven't yet made the transition, it could be beneficial to explore solar panel installation and consider adding a battery system to your setup.
For more information on how a battery can benefit you, see our detailed case study here.
To discuss your options, get a quote, and determine the best system for your home.
Book a consultation with us here.
All you need to provide is your electricity bill, and we will design a system tailored to your needs.
