Energy Minister Chris Bowen has defended the government's energy relief plan, issuing new figures that show a drop in forecast wholesale electricity prices for 2023.
The plan, which was announced in December last year, included a price cap on gas and coal, which was criticised by the opposition.
Gas producers in particular have been vocal in their complaints about the cap and some have been reluctant to sign new contracts with retailers, citing uncertainty.
However, Mr Bowen said new treasury analysis based on ASX data showed the government's plan to reduce prices was working.
"Today, figures released show that that intervention, while we still have some way to go, we still have more work to do, is having an impact," he said.
Treasury has compared forecast wholesale prices before and after the government announced its energy price relief plan.
It showed Queensland retailers paid 44 per cent less per megawatt hour to lock in future electricity supplies on December 21, compared to November 30.
There was a 38 per cent reduction in New South Wales, 32 per cent reduction in South Australia and 29 per cent in Victoria.
Households still hurting
The reduction in wholesale electricity prices will take some time to flow through to households.
The government has said households should expect to pay $230 less than they otherwise would have in 2023-34.
However, Mr Bowen couldn't put a timeline on exactly when that relief would occur.
"The next key indicator will be the release by the Australian Energy Regulator of the draft Default Market Offer in February," he said.
"That will be a draft and then the final will come out after that in May.
"That will reflect the next increases for Australians and that will reflect the intervention of the Albanese government and those increases being lower than they otherwise would have been."
Even when the relief flows through, many households might not notice the drop because the average household energy bill is expected to rise by $700 by the middle of next year.
Shadow Treasurer Angus Taylor said households were feeling the pinch right now and more action is needed.
"People say their bills, they are going up," he said.
"And nothing that Labour says, no spin, no amount of spin will change that outcome.
"The most important thing to bring down prices is to get more supply into the market."
Mr Bowen acknowledged households would feel some bill pain but insisted more support would be offered.
"There's more to do but this is a good step forward," he said.
"We welcome the impact of this intervention and we know that Australians realise there is more yet to be done – more yet to be done in terms of energy relief, more yet to be in terms of ensuring that the cheapest form of energy is introduced more and more into our system and, of course, that is renewable energy."
The federal government plans to provide targeted energy bill assistance to some households and plans to finalise the details with the states and territories by March.
Change in wholesale power prices:
Date |
NSW ($/MWh) |
QLD ($/MWh) |
VIC ($/MWh) |
SA ($/MWh) |
|---|---|---|---|---|
November 30 |
213.49 |
219.91 |
134.5 |
202 |
December 21 |
132.84 |
124.18 |
95 |
137.03 |
Change in price |
38 per cent |
44 per cent |
29 per cent |
32 per cent |
Source: Treasury analysis based on ASX data
