Prime Minister Anthony Albanese has been slammed for his failure to deliver promised reductions in energy bills, amid fears they are set to soar further as the cost-of-living crisis grips the country.
Wholesale power costs for the June quarter have increased by 23 per cent on the same period last year, according to data from the Australian Energy Market Operator.
This increase was driven by reduced renewable energy production and outages in ageing coal generators as government policy pivots away from the cheaper power source on environmental grounds.
The wholesale rise will not be felt by consumers immediately but will significantly push up prices for annual bills in the next default market offer on July 1, 2025.
2GB’s Ben Fordham criticised Chris Bowen, the Minister for Climate Change and Energy, and Mr Albanese over the price rises.
‘Under Chris Bowen’s leadership, power bills have not gone down by $275 as Anthony Albanese promised,’ Fordham said.
‘When wholesale prices rise by 23 per cent, you can expect your power bill to rise by the same amount. Can you afford that?
‘The average annual power bill is about $1,300, so if we’re right and power bills go up by another 23 per cent, the average power bill in Australia will skyrocket to $1,600.’
The Albanese government introduced a $300 energy bill rebate starting July 1, though critics argued such rebates only reduce pressure on energy companies to lower prices, and also fuel inflation.
Ben Fordham has criticised Anthony Albanese over his promise to reduce power bills, as Australian households face new threats of higher energy costs
Fordham called out Bowen for ‘lecturing everyone’ about the virtues of renewable energy when the consequent higher bills were crippling many at a time of soaring grocery prices and rising mortgage and rental costs.
‘Your power bills may go up by another $300 bucks, and Mr Bowen still thinks he’s in a position to lecture everyone else about energy policy,’ Fordham said.
‘If you’re already struggling with your power bills, avoid the inbox or the letterbox, because I’m sorry to say there’s bad news coming.’
Fordham also criticised Mr Bowen for ‘demonising’ coal-fired power, noting that it increased by 7 per cent in the June quarter and provided six times more power than wind farms.
‘Our coal-fired power plants were operating at about 80 per cent capacity,’ Fordham said.
‘So evil coal, as they like to describe it, has been picking up the slack and working overtime to keep Australia running. The same energy source that’s been demonised by the energy minister Chris Bowen.’
While the pro-renewable, anti-coal energy policy was designed to reduce global warming, the latest wholesale price hike was driven, ironically, by record electricity demand during a very cold June quarter.
‘On the east coast, we have seen low temperatures and persistent cold snaps, especially in Victoria, which have driven higher morning peak demands through the tail end of autumn and the first month of winter,’ AEMO CEO Daniel Westerman explained.
‘Extended periods of low wind have led to reduced wind generation output which was down 20 per cent from last winter to a quarterly average of 2,657 megawatts, with wind availability down to their lowest levels since Q2 2017.
‘These market conditions highlight the important role that batteries, pumped hydro and flexible gas generation will play as renewable generation becomes more dominant in Australia’s electricity grids,’ Mr Westerman said.
AER board member Jarrod Ball said a perfect storm of challenges had caused wholesale prices to rise higher.
‘While we would expect to see wholesale prices rise as weather in southern states cools and demand rises to keep people warm, the combined impact of cold snaps, planned and unforeseen network outages, combined with rebidding and lower solar and wind output, has pushed electricity prices higher than this time last year,’ Mr Ball said.
Fordham called out Albanese (left) for failing to keep his promise to reduce power bills by $275 and also took aim at Chris Bowen, the Minister for Climate Change and Energy of Australia, (right) for ‘demonising’ coal-fire power
Weak performance in renewable energy led to a comeback in coal power generation, with coal power generation increasing by 7 percent and gas generation rising by 16 per cent.
The Australian Pipelines and Gas Association warned that winter’s ‘renewable drought’ demonstrated the need for a reliable backup.
The industry body called for gas-powered generation to be included in the Capacity Investment Scheme – a national framework to subsidise wind, solar and battery projects – to ensure system security could be maintained.
Generator and network outages also created the opportunity for some market participants to “profit maximise” and shift energy offers to higher price bands, according to the regulator.
But Mr Bowen said argued that renewables were keeping power prices down.
‘The data shows renewables provide cheaper power, and when we’re forced to rely on coal generation and ageing unreliable assets, it drives prices up. The faster we can get more reliable renewables into the system, the better it will be for energy bills and energy reliability.’
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