Energy costs are on the rise once again, and this time it’s happening at the start of July 2023. Key regulators have made a decision that will impact bills across the country. The Australian Energy Regulator (AER) recently announced its default market offer (DMO) for the next financial year, revealing that electricity prices in some states will increase between 20 and 25 percent. That’s higher than their previous estimate from March.
But what exactly is a default market offer? It’s the maximum price that energy retailers can charge their customers on default contracts. In States where multiple energy companies compete, there’s no set price for electricity. Different customers may pay different rates depending on factors like time of day. The default market offer acts as a benchmark, providing a reasonable price for electricity and making it easier to compare plans across different retailers.
Who will be affected by these price hikes? Customers on the default offer in South Australia, New South Wales, and South East Queensland will see their bills increase by 20% to 25%. In Victoria, the Essential Services Commission (ESC) will also raise prices by 25%. The estimates for remaining States and Territories are not yet available, but they will be made clearer in the coming months.
Why do prices vary across states? It comes down to the cost of building and maintaining electricity infrastructure like poles and wires. These costs vary depending on location, with far-western New South Wales facing higher delivery costs due to longer wires and fewer users. The current price increases are also influenced by inflation, as retailers pass on the higher costs they face to consumers.
With rising energy costs, many wonder when prices will go down. Unfortunately, the volatile global energy market makes it difficult to predict. Forward contracts indicate that prices may remain steady for the next 12 months. However, if international fossil fuel prices stabilize, there is a possibility for prices to decrease. It’s important to keep an eye on market trends and government interventions.
So, what can you do to combat rising energy costs? Here are some actionable steps:
1. Shop around: Depending on where you live, there may be different energy providers offering better deals. Take the time to explore your options and be prepared to switch if necessary.
2. Talk to your energy retailer: If you’re having trouble paying your energy bills, don’t hesitate to reach out to your provider. They are required by law to help you, whether it’s setting up a payment plan or finding a better deal.
3. Utilize the regulator’s website: The AER provides a website where you can compare offers and find the best plan for your needs. Take advantage of this resource to ensure you’re getting the most value for your money.
4. Retrofitting your home to be more energy efficient is another effective way to reduce costs in the long run. By investing in energy-efficient appliances, insulation, and renewable energy sources, you can lower your reliance on the grid and cut down on energy consumption. Not only will you save money, but you’ll also contribute to a more sustainable future.
If you are not sure where to start on your retrofitting journey, maybe check out this page – I Don’t Know Where to Start.
As energy costs continue to rise, it’s crucial to take action to protect your wallet and the environment. By staying informed, shopping smart, and making energy-efficient upgrades, you can navigate these challenging times and create a more sustainable home for yourself and your family.
People Also Ask:
⇒ Where can I learn more about this from an industry expert?
ecoMaster has been working in the energy efficiency / retrofit arena for over 20 years. During that time we learnt an enormous amount about diagnosing issues, distinctions on various products as well as developing the best installation practices. We have done the research, so you don’t have to. All that information has now been condensed into a series of ecoMasterClasses. Click here to gain access.
⇒ Who will be affected by the price hikes?
Customers on the default offer in South Australia, New South Wales, and South East Queensland will see their bills increase by 20% to 25%, while in Victoria, prices will be raised by 25%.
⇒ What are some effective ways to prepare my home for rising energy costs?
Some effective ways to prepare your home for rising energy costs include improving insulation, draught proofing / sealing air leaks, upgrading to energy-efficient appliances, upgrades to windows or installing more thermally efficient window coversings, and considering renewable energy sources like solar panels.
⇒ What can you do to combat rising energy costs?
Answer: There are actionable steps you can take, such as shopping around for better energy deals, reaching out to your energy retailer for assistance with payment plans or better deals, and utilizing the regulator’s website to compare offers and find the best plan for your needs. Retrofitting your home to be more energy-efficient is also recommended.
We hope this article has helped you learn how to use simple ways to save on your utility bill. This in turn will help you on your energy and thermal efficiency retrofit journey to make your home more comfortable all year round, and reduce your costs and carbon emissions.
Next, explore What is Draught Proofing
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Be prepared for the price rise