Australians in one state are facing a $228 annual hike in their electricity bills with the pain likely to get worse as government-funded rebates end and more customers charge electric cars at home.
The Australian Energy Regulator’s final determination report, released on Monday, had bad news for consumers, starting on July 1 as winter pushes up demand for heaters.
This is based on what retailers can charge customers in NSW, south-east Queensland and South Australia during the next financial year under a default market offer.
High demand and network outages were blamed for the steep wholesale prices feeding into higher retail prices, along with low levels of renewable energy as Australian governments try to phase out coal-fired power stations.
‘These spot prices were partially driven by a greater frequency of high price events, which resulted from a range of factors including high demand, coal generator and network outages, and low renewable generation output,’ the AER said.
In regional New South Wales, Essential Energy residential customers face the biggest increase of $228 or 9.1 per cent, with the AER citing ‘improved network resilience to address climate change-related risks’ along with ‘the integration of consumer energy resources including rooftop solar, batteries and electric vehicles’.
This takes the average annual electricity bill for 2025-26 to $2,741, which is even steeper than the $188 or 8.5 per cent increase for Endeavour Energy customers in Sydney, who will be paying $2,411.
The increases in NSW were up to 6.7 per cent above forecast inflation, with more homes having a smart meter monitoring when residents used electricity.
Australians in one state are facing a $228 hike in their electricity bills with the pain likely to get worse as government-funded rebates end and more charge electric cars at home
‘Retail costs have risen for all customers in each region of NSW, primarily due to increases in retailers’ operating costs,’ the AER said.
‘Increases in bad and doubtful debt costs and smart meter costs also contributed to the overall increases.’
In south-east Queensland, Energex’s increases were more moderate at $77 or 3.7 per cent, or 1.3 per cent above forecast inflation to an average of $2,143.
South Australians were set to see a $71 or 3.2 per cent increase, which was 0.8 per cent above predicted inflation for SA Power Networks customers, for an average bill of $2,301.
Canstar data insights director Sally Tindall said the increases were bad news for customers.
‘These electricity price hikes will knock the wind out of the sails for many families, just when they thought they’d turned a corner in the cost-of-living crisis,’ she said.
‘Price hikes of up to $228 for an average household will be too much for some families to bear, particularly as we enter one of the most energy-intensive periods of the year.’
The AER projected bigger increases for customers without a controlled load, where an electrical appliance like a dishwasher can be operated at a different time to the rest of the home to save money during an off-peak period.
The Australian Energy Regulator final determination report, released on Monday, had bad news for consumers, starting on July 1
The federal government’s quarterly $75 rebates were extended until the end of December in the pre-election March Budget, where the price came off the bill without customers having to lodge an application for relief.
This has seen electricity bills fallen by 9.6 per cent in the year to March, helping to reduce headline inflation to just 2.4 per cent.
The AER argued its determination regarding existing customers struck a balance between ‘protecting consumers from unjustifiably high prices, while also allowing retailers to recover costs’.
‘Retail costs have seen larger increases in all regions,’ it said.
‘While this source of costs makes up a smaller portion of the total price, the rate of growth means it has contributed more than other elements to the price rises in some regions.’
Wholesale power prices make up 31 to 45 per cent of the AER’s default market offer arrangement on electricity bill increases, compared with 11 to 16 per cent for retail costs.
Network costs made up 33 to 48 per cent of the approved price rise.
