Tasmanian power prices will remain almost unchanged for the next 12 months and, when combined with state and federal government rebates, consumers could see an overall reduction.
Tasmanian Economic Regulator Joe Dimasi has approved an average price increase of 0.5 per cent for residential and small business customers of state-owned energy retailer Aurora Energy.
It means the annual power bill for most residential customers will increase by $16, and by $5 for business customers.
The stable price follows two years of significant increases — by 9.5 per cent in 2023–24 and by 11.9 per cent in 2022–23.
Mr Dimasi said the stable price for the next 12 months was driven by overall Australian wholesale energy prices, to which Tasmania is connected as an importer and exporter via Basslink.
“It’s still driven largely by wholesale energy prices, but this year, they have fallen compared to last year,” he said.
“We have seen a big fall in wholesale energy prices.
“It’s a very volatile market. You have to just see how it goes.”
Transmission costs passed on
Wholesale energy prices had dropped by such a significant amount that Tasmanians were in line for lower power bills.
But increased network charges effectively balanced it out, Mr Dimasi said.
“These are due to increased expenditure in the transmission lines,” he said.
“And that has meant that those TasNetworks costs get passed on, and we have to just pass them on. And unfortunately, they have spoiled the party a little.”
The federal government has announced a $300 rebate for all households, and a further $250 with the Tasmanian government, which also has a renewable energy dividend to reduce power bills.
Energy rulings on three-year cycle
Tasmania’s costs are based on a three-year methodology, with 2024–25 the final year of the cycle.
The economic regulator will then set new rules for the next three years.
Mr Dimasi said the volatility in wholesale energy prices meant it was difficult to say whether prices would remain stable beyond 12 months.
“We will have that debate, that discussion, with Aurora about how those rules will work for those coming three years,” he said.
The feed-in tariff will reduce by 17.8 per cent for the coming 12 months, driven by the reduction in wholesale electricity prices.
The economic regulator will examine the structure of Aurora’s tariffs and flat rate tariffs — which it intends to grandfather — during the upcoming three-year review.
The review comes at a time of significant change to the way in which power bills are calculated across Australia, with more consumers being moved onto “time-of-use” tariffs, where the price changes depending on the time of day.
This is in response to the ongoing transition to renewable energy sources.
Turning on the heater a concern for some
The relatively unchanged power bills have not been welcomed by all.
The Tasmanian Council of Social Service remains concerned that they are still unaffordable for those on low incomes, due to the rises of the previous 24 months.
Chief executive officer Adrienne Picone said even a small increase would make things harder.
“Tasmanian households will be making decisions about whether they turn the heater on in this very cold Tasmanian winter,” she said.
“We shouldn’t be in a situation where people are going cold and unable to afford to pay their bills and put food on the table.”
Ms Picone said Tasmanian consumers were at a disadvantage due to the lack of competition in the retail energy market.
The Tasmanian Labor opposition remains committed to a policy of capping power prices and has repeatedly questioned the government for not de-linking from the National Electricity Market.
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