Victoria braces for January 1 power price hike

BENDIGO residents could pay an average of $230 per year more for their combined electricity and gas bills in 2017 as a price hike comes into effect from January 1.

Consumers are being urged to shop around to avoid price gouging, with the bulk of the electricity price rise blamed on the looming closure of the Hazelwood power station.

St Vincent de Paul policy and research manager Gavin Duffy said people in regional areas traditionally had higher power bills for a range of reasons.

“On average, people in regional areas have lower income but also have higher electricity costs due to the higher poles and wires charges they face,” he said.

“Households with gas and electricity, the spread for most people is between about $200 to $300 a year could be more.

“For those that are active in the energy market the price increase will be less but we won't know the exact details until post January 1.”

The full impact of the price rise is unlikely to be felt until winter, when demand reaches its peak.

Tariff changes will also come into effect from January 1.

A spokesperson for AGL said Victoria’s energy market was “very competitive”, and prices could vary significantly depending on circumstances.

AGL predicts electricity prices will increase by an average of $2.59 per week for customers using 3.69 megawatts per hour, while gas could increase by $1.86 per week for 46 gigajoules, including GST.

Time to shop around for a better deal

Walking through Hargreaves Mall on Thursday afternoon, Bendigo couple Diane and John were not surprised by news of the looming power price increase.

They said they could cope with a slight increase, but were fearful of the impact on older residents.

“It’s been a hot few weeks so people have been using plenty of power, I hope it doesn’t stop the elderly from keeping their air conditioners on,” John said.

“It might make a few more people consider solar as well.”

Gavin Duffy, of St Vincent de Paul, said the increased squeeze on the cost of living could force some to make sacrifices.

“From our experience, people who struggle to pay bills ration their energy use, but they also ration or go without other household items, from kids school camps, to going without breakfast and in more extreme cases being disconnected because they just can’t pay,” he said.

“Practical option for people are if they are pensioners or health care card holders to make sure you’re getting your energy concession, also be aware that the state offeres bill relief though the utility relief grant scheme and the retailers are obliged to have hardship programs.”

The average weighted residential tariff change with AGL will be 9.9 per cent, and 13.4 per cent for the small business tariff.

The AGL spokesperson said there were options for energy customers to make their bills more manageable.

“We encourage customers to take advantage of our monthly billing plans to break bills down into more manageable, regular amounts,” he said.

“If customers are experiencing financial difficulty, there is a range of support available including payment plans, energy concessions, referral to financial counselling services and where appropriate debt relief on a case by case basis.”

Energy Minister Lily D'Ambrosio said the government would come down hard on energy companies that price gouge.

She encouraged Victorians to shop around as much as possible.