Electricity prices to level out due to renewables mix

20 December 2017

The Australian Energy Market Commission (AEMC) has published its 2017 Residential Electricity Price Trends report.

Electricity prices are predicted to level out, or even drop, as a more varied mix of renewables-based generation serves to offset this year’s price increases.

The National Energy Market is moving from predominantly large-scale synchronous generation to more numerous small, distributed and intermittent non-synchronous generators.

Older coal-fired generators are retiring and more large-scale renewables-based generators have been connected.

AEMC Chairman John Pierce said this year’s report shows wholesale electricity costs are now the single biggest driver of change in residential electricity bills – unlike earlier price trends reports which found network costs were the main driver. 

‘Prices rose sharply this year by almost 11% on a national basis as consumers felt the impact of Hazelwood and Northern coal-fired plants retiring and the lack of replacement investment, combined with high gas prices,’ Mr Pierce said.

‘But we expect these price rises will be reversed over the next two years as around 4000 megawatts of RET-funded wind and solar generation enters the system.’

See the AEMC’s Residential Electricity Price Trends report and associated data and key documents, including fact sheets and infographics for each of the states and territories.