The Beagle Editor,
On Wednesday, 11 May I went to vote early at the Batemans Bay Community Centre. The Liberal candidate for Gilmore, Andrew Constance, was there handling out how to vote material. I approached him for an explanation on why electricity prices were rising so high, so quickly.
BACKGROUND TO ELECTRICITY PRICE RISES
On Monday, 9 May 2022 my electricity retailer, ReAmped, emailed me to detail rises in the wholesale price of electricity and warn about a pending increase in the retail price of electricity. The following is reproduced from that email.
…this change is unavoidable due to the extremely elevated wholesale rates now being seen in Australia. This is a challenge we expect all retailers to face in the weeks and months ahead.
Your prices are shown below (including GST):
Existing From 24 May 2022
Peak: $0.3236/kWh
Shoulder: $0.3088/kWh
Off-Peak: $0.1813/kWh
Ctrl Load 1: $0.1439/kWh
Supply Charge: $1.3771/day
From 24 May 2022
Peak: $0.396/kWh *
Shoulder: $0.2365/kWh
Off-Peak: $0.2937/kWh **
Ctrl Load 1: $0.1481/kWh
Supply Charge: $1.4334/day
* An increase of 22.4%
** An increase of 62%
Why are energy prices going up in Australia?
Demand for coal, gas and oil has increased across the globe as the COVID recovery continues, while Australia's own energy market has been suffering reliability issues. Together with the conflict in Ukraine as well as the impacts of inflation, this has created the perfect storm for a higher wholesale energy environment that is ultimately out of our control.
(See also this recent article in The Conversation - https://theconversation.com/electricity-prices-are-spiking-ten-times-as-much-as-normal-here-are-some-educated-guesses-as-to-why-182849)
These price rises are extraordinary. Note that the price rise is due to costs incurred with fossil fuels. The increasing supply of electricity from renewable sources has not yet been able to offset these fossil fuel factors.
BACK TO MY QUICK DISCUSSION WITH ANDREW CONSTANCE
I began our quick chat by showing Andrew the email from ReAmped and asking him what a Liberal/Nationals coalition government would do to address these substantial rises. Initially, Andrew was quite polite and suggested that the price rises were "retail" - the implication being that ReAmped was price gouging. I was able to show him that the price rises were "wholesale" and thus would impact all electricity users.
Andrew seemed unable to offer any help. Instead he asked what I thought was the reason for these price rises.
I explained that the underlying reason, in my view, was the lack of a coherent and viable renewable energy policy by successive Coalition governments going back to Tony Abbott. I pointed out the progress made in South Australia and the early progress being made in New South Wales (not enough yet to significantly impact on the whole electricity market). I pointed out that, again in my opinion, consumers were now paying the price for ideological intransigence by successive LNP governments.
Andrew looked dumbfounded and offered no counter view. Instead he asked me to move on! I'd had my turn and was taking up too much of his valuable time. I was left with the feeling that the Liberal candidate had no understanding of the issues around climate change and renewable energy and had little interest in the effects on voters.
Is this an example of a career politician seeking election because he's "entitled" to be in parliament not because he has something in particular to offer voters?
Needless to say, Andrew did not get my vote!
Regards,
Peter Anderson Broulee NOTE: NOT Peter Anderson of Malua Bay
Constance suggests that the NSW government privatise the rest of its poles and wires infrastructure to help fund a fast rail link between Newcastle and Nowra.
“We [NSW] need a train that can do 250 to 300 [km/h] ... it would be magnificent and that in itself changes and eases the pressure on the Sydney basin, deals with the population question and at the same time we start to develop out the regions in an incredible way,” Mr Constance said. AFR Nov 2021
