Market Review: Completed
On 9 December 2019 the Australian Energy Market Commission published its annual Residential Electricity Price Trends report. This is the tenth residential electricity price trends report prepared by the AEMC at the request of the Council of Australian Governments’ (COAG) Energy Council.
The report identifies changes in the energy supply chain cost components that are driving residential electricity prices and bills for each Australian state and territory (excluding the Northern Territory), and nationally, from 2018-19 to 2021-22 (the reporting period). By focusing on trends in the cost drivers of prices and bills, the report helps to focus attention on key sectoral issues.
The pricing and bill outcomes in this report do not constitute specific pricing and billing forecasts. Actual price movements will be influenced by how retailers compete, the dynamics of wholesale spot and contract markets, the outcomes of future network regulatory decisions, and changes in policy and legislation.
On a national basis, representative residential electricity prices and bills are expected to decrease over the period from 2018-19 to 2021-22, primarily driven by wholesale costs reducing in most of the states and territories. Prices fall markedly over the whole reporting period as new capacity enters the system. Total capacity of committed projects includes 2,338 MW of solar, 2,566 MW of wind and 210 MW of OCGT.
Regulated network prices have been cut in response to falling distribution costs and environmental costs are being driven down by cheaper large-scale generation certificates for increasing levels of renewable generation.
Western Australia is the exception to this national trend, with electricity prices and bills expected to increase over the period.
For further information contact Vanty Tang on 02 8296 7806 or Prudence Anderson on 02 8296 7817.