Each year, energy rates are reviewed and measured against changes to network costs, government schemes and the wholesale price of energy. These variables generally dictate whether rates increase or decrease. The Australian Energy Regulator submits an annual pricing proposal and, once approved, it takes effect 21 days after the retailer gives their customers notice.
The changes to energy prices also account for spot prices: the price of a kilowatt every half an hour. Depending on usage, the value of energy can fluctuate between 5c and $15 per spot, and these higher prices account for periods of excessive use or outages. Electricity retailers, anticipating these spikes, charge enough to cover this and maintain a profit.
The new financial year marks the start of a new pricing policy, and South Australia will be seeing increases to residential and business energy prices.
Low voltage residential price changes are set to increase by 5%, a charge which is likely to be passed onto the customer.
What does this mean for South Australia, and more importantly the energy prices for residents of the Spencer Gulf, Mid North and Yorke Peninsula?
Consumers can expect an increase of roughly $100 per year; however, prices will vary due to differing retailers and electricity usage.
If prices do change with your provider, you will receive correspondence regarding the update in fees. If you are unhappy about the rising costs, it's advised you shop around and compare prices with other retailers.
For a more detailed guide on the forthcoming changes in electricity pricing, see the SA Power Networks' Pricing Proposal here, on the Australian Energy Regulator website.
Written by Erin Connellan