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Northern Territory government promises power bill subsidy worth $71 million

Palmerston mother Esha Karki says her young family is noticing higher utility prices. (ABC News: Dane Hirst)

The Northern Territory government has unveiled a $71.7 million boost to its subsidy of household energy bills, in a pre-budget sweetener Treasurer Eva Lawler says will help stimulate the economy.

Power prices in the NT are pegged to inflation, meaning households were bracing for a 6.8 per cent increase in their electricity tariffs from July 1.

But at a press conference on Wednesday, Ms Lawler said the cash injection means tariffs for homes will only increase 2.7 per cent in the 2023-24 financial year.

Palmerston mother Esha Karki, who said she has noticed the cost of her weekly shop increasing, welcomed the announcement.

"I check prices, I used to work in Woolies so I know the prices before and now … it has massively gone up," she said.

"Everything is up at the moment — water, power … I'm scared what's going to happen next, because everything has gone up."

Ms Karki said she felt "restricted" by the cost of living, but was also sceptical that the government's announcement would go far to help her young family.

"It will be helpful, but we will have to wait and see if it happens.

"Everything is affecting my living, my husband and my little boy."

The government says power price increases in the NT will be less drastic than on the east coast. (ABC News: Hamish Harty)

Overall, the NT government is expected to spend $161.3 million in 2023-24 paying Power and Water Corporation and electricity retailers such as Jacana Energy to subsidise energy bills. 

"Many territorians aren't aware that every time they pay their power bill, that the Northern Territory government has subsidised that power bill," Ms Lawler said.

"Over a year, that subsidy is nearly $1000 [for an average household]."

Ms Lawler, who will hand down her first budget as treasurer on May 9, said she hoped the increased subsidy would put money back into the NT economy. 

"It's that knock-on effect. If people have lower power bills, they have more money in their pocket, there's more opportunities to get out and about to our cafes, our restaurants and spend money in the territory."

"We want territorians out spending money."

But Ms Lawler would not be drawn on whether the increased subsidy would impact the budget bottom line, saying further details would be made public on May 9.

Treasurer Eva Lawler says she hopes territorians will spend more money at local businesses as a result of the increased subsidy. (ABC News: Nicholas Hynes)

Call to help most vulnerable with bills

The NT government said the power bill subsidy was part of roughly $200 million in 'savings relief' in the upcoming budget, which also included schemes such as school vouchers and first-home buyer grants.

NT Opposition Leader Lia Finocchiaro said the government's initiatives were "cold comfort" to territorians grappling with increasing mortgages, rent, fuel, groceries and insurance premiums. 

"Nothing that Natasha Fyles has announced today is going to provide any relief to that," she said.

Jonathan Pilbrow, who advises the Northern Territory Council of Social Service (NTCOSS) on issues around cost of living, said the government's measures would do little to help those in social and remote housing, who are reliant on pre-paid electricity meters. 

An Australian National University study released earlier this month found energy insecurity had already worsened for many Indigenous communities throughout the pandemic, because measures to protect people from being disconnected from the grid were not extended to those on pre-paid meters.

Mr Pilbrow said data collected by NTCOSS showed that in the past two years, there had been a 21.4 per cent increase in households on prepayment electricity meters being disconnected.

"They're often large households with large bills, so even the 2.7 per cent increase in the cost of their electricity tariff is going to have a significant impact on their ability to meet their electricity and other needs," he said.

"It is a concern that we still haven't seen this addressing of the fact there is so many disconnections happening for people on pre-payment meters."

Mr Pilbrow also warned many organisations assisting poorer households were themselves struggling to keep up with demand, with funding increases not keeping up with inflation.

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