NSW electricity and gas price hikes
In a sting for residents, electricity and gas prices in New South Wales are set to rise.
This comes after a decision by the NSW Independent Pricing and Regulatory Tribunal (IPART) to increase regulated gas and electricity prices.
In its draft decision, IPART has forecast an average increase of three per cent for electricity in 2013-14 and 8.6 per cent for gas.
"While the price increases will be in line with inflation for electricity, the draft decision shows that gas prices are experiencing a significant increase," said Cameron O’Reilly, chief executive of the Energy Retailers Association of Australia (ERAA).
One of the main reasons for the gas price rise is the need for investment in upgrades in the network, which was a significant factor last year in the electricity sector.
Additionally, recent developments in domestic coal seam gas production have led to some uncertainty in the future of NSW gas prices.
Mr O'Reilly suggests there is no cause for undue panic and while these gas price rises are significant, on average household customers spend twice as much on electricity as on gas, so the effects of the rise will not be as extreme.
"While the draft determination estimates that customers will see an increase in regulated tariffs from 1 July, the ERAA encourages customers to talk to their retailer to ensure they are on the best tariff in the market," Mr O’Reilly said.
In such cases, an electricity comparison service is of great use to make sure that you are paying the lowest possible rate for your electricity and gas.
Mr O'Reilly also comments that if NSW followed in the footsteps of other states in moving to full deregulation of energy prices, there would still be cost pressures however customers would benefit from a greater number of options and offers, allowing for a more dynamic and service focused energy retail sector.
In 2009 the state of Victoria phased out price regulation, and South Australia also recently did so in February of this year.
Since Victoria's deregulation, the state has seen more choice for consumers.
Earlier this April, a report from The Public Interest Advocacy Centre (PIAC) was released outlining how NSW was experiencing an increasing number of households getting their power disconnected as they were unable to pay their rising bills.
In light of IPART's latest announcement, more NSW households may need to seek assistance from programs such as the Energy Accounts Payment Assistance Scheme (EAPA) to cope with rising bills.
Posted by Callum Fleming