Impending energy price hikes are no shame for the government, says the prime minister, despite describing the increases as significant.
The Australian Energy Regulator published its draft default market offer decision on Wednesday for the next fiscal year, showing an increase of 25.4 per cent, or $1,738 per year more, from July 1.
The default market offer represents the maximum price energy retailers can charge residential and small business customers in New South Wales, South Australia and South East Queensland.
The final decision on what the offers will look like will be made in May.
Anthony Albanese said the price increases would be even higher if it weren’t for government intervention in the market.
However, he said Australia was not alone in experiencing rising energy costs.
“The bottom line is that there has been a war in the Ukraine that has raised world energy prices. And because of our energy market and the way it works, that also has an impact on Australian prices,” he told Melbourne radio station 3AW on Thursday.
“(The price increase) is very significant and that’s why we intervened in the market in December; the increase would have been much higher.”
The government intervened in the market by capping the price of coal and gas, with money set aside for energy bill relief measures.
He has signaled relief in the federal budget, due in May, through rebates being negotiated with states and territories.
Asked if the price increases were embarrassing given election promises to lower energy bills, Albanese denied that they were, pointing to the overall price increase.
Deputy Liberal leader Sussan Ley said the government was presiding over a cost-of-living crisis.
Meanwhile, ACT Chief Minister Andrew Barr announced that the capital would be the only state or territory in the national electricity market where FITs would decrease in 2022/23.
In his State of the Territory address, Barr said ACT consumers were effectively protected from high electricity prices due to long-term renewable energy contracts.
“The climate action plan that the ACT government has been leading for decades will ensure that ACT remains in the best position to support our Canberra economy, community and households through the national transition to a low emission future,” he said.
“Our climate action agenda is showing the way for others and we are already seeing the benefits.”
Australian Small Business Organizations Council Chairman Matthew Addison said AAP owners would have to manage costs significantly in the coming months.
“If energy becomes more expensive again, business owners often work more and get paid less. Many will consider closing,” Addison said.
The head of the Australian Chamber of Commerce and Industry, Andrew McKellar, said the expected rise in energy prices was a “hammer blow” to small businesses already facing rising input costs.
He urged accelerating investment in renewable energy generation, storage and transmission to keep up with growing energy demand.