Yahoo Finance Electricity prices: Aussie reveals $200 saving as expert shares when bills will go down
Energy bills are soaring and Aussies will have to wait to receive hip-pocket relief.
Wholesale energy prices have fallen nearly 60 per cent in the past year, but that doesn’t mean electricity relief is coming for Australians anytime soon.
Many Aussies would have noticed their energy bills had gone up after July 1 increases started to trickle down into the quarterly statement, with prices skyrocketing by as much as 25 per cent in some parts of the country.
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Money-saving expert Joel Gibson has warned financially stressed households won’t reap the benefits of the falling wholesale prices for up to another year. That is unless you’re like a Queensland mum who has leveraged wholesale prices to cut her bill to just $100 a quarter.
“At the same time last year, wholesale prices spiked to almost three times what they've usually been over the past five years,” Gibson told Yahoo Finance.
“The long-term average is about $100 per megawatt hour. Last year, it almost reached $300. Recently, it's been below $70, which is fantastic news and shows the government interventions last year, such as capping wholesale gas prices and coal prices, are having an impact.”
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The weather also factored into low wholesale prices, Gibson said, with milder temperatures meaning Aussies didn’t need too much heating.
“But once again, any drop in wholesale prices will take six-12 months to flow through to our bills, so don't hold your breath,” Gibson said.
“So, there are good signs that the worst of last year is behind us, but it's still hard to say if prices will drop and by how much.”
Aussie saving $200 a quarter accessing wholesale energy
The only exception to this timeline is households on a plan where they pay a monthly fee and access current wholesale rates, rather than a flat price.
“There are only a few retailers who do this and, last year, their prices were through the roof but now they're looking much better,” Gibson said.
Geisa Schreiner slashed her bills from roughly $300 a quarter to just $100 by subscribing to wholesale electricity with Amber Electric.
“We are saving almost $200 a quarter, which is really good. We use a lot of electricity because of our babies. There is a lot of washing and heaters so they don’t get sick at night,” the Queensland mum-of-two told Yahoo Finance.
Wholesale prices are set at 30-minute intervals by the Australian Energy Market Operator (AEMO) and can fluctuate up or down depending on supply and demand.
For example, wholesale prices can be higher when lots of people are using power at the same time (typically in the evenings), when the wind isn’t blowing or the sun isn’t shining.
On the flip side, prices can be lower when not many people are using power (typically in the middle of the day and overnight), when the wind is blowing and the sun is shining.
In a bid to drive down costs, Schreiner said she tried to use larger appliances during the day to take advantage of lower prices when the sun was out.
She said had not noticed huge price fluctuations. In fact, she said her savings during the day gave her “peace of mind” when she had to use appliances that consumed more energy at night.
“If I had to switch the heat on at night for the kids, I don’t worry about it because we are saving during the day,” Schreiner said.
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