Manipulating wholesale electricity market prices to "gouge" customers is wrong. It does not happen at EnergyAustralia.
Questions about why wholesale market prices increased sharply following the closure of the Hazelwood power station have been answered by government regulators and authorities in comprehensive reviews. These include:
- The Australian Energy Markets Commission’s report, Assessment of rebidding in the national electricity market, published in September 2018
- The Australian Competition & Consumer Commission’s report, Restoring electricity affordability & Australia’s competitive advantage, published July 2018
- The Australian Energy Regulator’s report, Electricity wholesale performance monitoring Hazelwood advice, published in March 2018, and
- The New South Wales Independent Pricing & Regulatory Tribunal’s report, Review of the performance and competitiveness of the retail electricity market in NSW, published in December 2017.
The reviews were thorough, done by independent experts and are publicly available; none called out inappropriate behaviour in the wholesale electricity market by generators.
For example, the AER said its analysis did not identify the "opportunistic exercise of market power" or that generators had withheld capacity from the market. Rather, the AER’s key finding was that:
"The exit of Hazelwood removed a significant low fuel cost generator which was largely replaced by higher cost black coal and gas plant – at a time when the input costs of black coal and gas plant were increasing."
Of course, there will be outlying opinions about why market prices have increased.
But rather than go over very old ground yet again, our approach is to address the issue at hand: high energy prices and system reliability. That’s what matters for customers.
EnergyAustralia is assessing new projects, liked pumped hydro in South Australia and flexible gas in New South Wales, which can add capacity to, and help stabilise, the grid.
And while we do that we’re supporting vulnerable customers with an additional $10 million investment in our hardship program and a $15 million initiative to help charities cut their energy bills.
That’s on top of the commitments we made in 2018, including:
- Keeping annual electricity prices flat on average for customers in New South Wales and Victoria by paying $55 million to offset increased network and green scheme costs
- Providing automatic discounts of 15 per cent on electricity and gas usage for eligible EnergyAustralia concession-card customers, such as pensioners and veterans, on default tariffs, and
- Removing fees for paper bills and over-the-counter transactions by cash or cheque via Australia Post for all customers in New South Wales, Victoria, South Australia and Queensland.
Some say our energy system is broken; others say it’s not.
We’re just focussed on getting bills down and helping customers in need.