Melanie Riley
SOUTH Australian households and small businesses will soon see reduced energy bills, in a move to help ease financial pressure on consumers.
The final decision was announced by the independent Australian Energy Regulator (AER) recently, and the cuts will come into effect from July.
The cuts will include 2.8 per cent, or $63, for average households and 8.8 per cent, or $512, for small business.
The 8.8 per cent cut for small business is the biggest percentage reduction in the nation of all categories determined by the AER.
The state government welcomed the AER’s decision, noting the cuts were bigger than signalled by the regulator in its draft decision in March, when it flagged 2.5 per cent and 8.2 per cent cuts respectively for households and small businesses.
The cuts will complement the state government’s measures to assist vulnerable households manage the cost of living and the Australian government’s $300 rebates to all residential accounts.
The AER independently sets a ceiling price each year – called the Default Market Offer – which provides a safety net for consumers who have not shopped around for a better deal, and acts as the comparison point for all retail contracts.
Lower wholesale costs are the main factor in the AER’s draft decision, driven by more supply from renewable energy project.
There has also been an easing in the global gas market as Europe finds alternatives to Russia supply and the Australian government’s price cap takes effect.
With the state government’s Hydrogen Jobs Plan on track to strengthen reliability, the biggest danger to electricity prices and security is the Liberal folly of pushing for nuclear energy in Australia.
The government reaffirmed its support for nuclear in countries with limited opportunities to decarbonise.
However, in Australia, there is no demonstrated business appetite to invest in nuclear because there are plentiful resources to develop renewables.
As confirmed this week by the nation’s leading scientific organisation, the CSIRO, nuclear is the most expensive way to generate electricity and cannot be delivered in time to avoid power shortages as ageing coal-fired stations close.
A local Mount Gambier/Berrin resident welcomed the cuts to electricity bills, and said every little saving helps.
“I think it’s good news and it will be a bit of a relief for struggling households,” she said.
“It will lessen the burden a little bit on those everyday household bills.
“I haven’t noticed a huge increase in my electricity bill as I live on my own, but for those larger households, they seem to be feeling the pinch a little more.”
She said she has always been cautious of her energy use in her home, to help keep those costs down.
“I turn the lights off when I leave a room, switch my appliances off at the wall when not in use and use things like heating efficiently and only run them when I really need to,” she said.
“Making small changes every day to help save power can help minimise the chance of a shockingly high bill.”
Minister for energy and mining Tom Koutsantonis said the cuts were made as a move towards “building a cleaner, more affordable and reliable energy system” and said there was work to be done to fix Australia’s vulnerability to price shocks.
