Should I expect electricity price increases?

It is no secret that Australia has high electricity prices, with regular increases happening year on year. The average annual electricity bill is around $1,800 and it looks like higher energy prices are here to stay.

Prices have increased year on year due to coal-fired power stations being closed down, meaning the supply was reduced and the prices were inflated. In this article, we are going to run through factors that contribute to price increase as well as what to look for in the future.

 

What contributes to the price increase?

  • The government: Depending on what a governing body decides, it can directly impact the cost of energy overall. If there is a large political change, this can influence how much money you will be charged.

 

  • Weather: Believe it or not, the weather can directly impact a spike in electricity charges, as particularly challenging weather conditions can cause companies to work harder to provide parts of Australia with electricity.

 

  • Imports/Exports: Depending on the demands coming in and out of Australia can impact how much your electricity can cost you. If there is less demand for our exports, then pricing will go up in all areas, especially commodities.

 

Another factor that is controllable (to a degree) when it comes to an increase in electricity is a switch in tariff. After a certain period of time, your provider will move you off your plan (which may be 12-18 months long) on to a standard tariff plan. If you are unaware of this, then this may be the reason why your electricity has suddenly spiked in price. This is something that is easily solvable, as you can switch providers to get a better plan financially. Most people who are looking to save money on plans will switch every 12 months at least; as they will constantly be chasing deals and plans that are suited to their living and personal situation, which can change all the time.

Unfortunately, you will always expect an increase in electricity prices in one way or another, but the best way to monitor this and avoid bill shock is as follows:

  • Keep up to date with the news: Things such as political changes or the weather can be easily tracked, at least this way you are able to prepare yourself for a potential spike in electricity. Reading the news online will have public information about this so you can stay in the know.

 

  • Use a smart meter or a home monitoring system: This is a brilliant way to track your usage against your spending, and another way to see whether you have been switched over to a standard tariff.

 

  • Use a price comparison website every 8-12 months: Using a price comparison website on a regular basis can ensure that you are getting the best deal, and being consistently on the ball with the latest deals can mean that you can avoid electricity increases as much as possible.

In short, price increases in some circumstances are inevitable, and it is important to keep on top of current affairs, as well as use a price comparison website to get the best deal possible.

 

Author: Claire Stapley
Claire Stapley is ElectricityComparison.com.au's Energy Editor, based in Melbourne Australia. Claire is a founding member of ElectricityComparison.com.au News and Energy Team.