Consumers warned that high energy prices are "the new norm"

Consumers have received bad news about their electricity bills, with the release of a major new report on the future of energy prices in Australia.

The main message of the report was that the good old days high energy prices are "the new norm" – and there is virtually nothing the government can do about it.

So it seems like you'd better get used to this painful feeling every time you open your energy bill. report published by the Grattan Institute, released over the weekend, has had a small glimmer of hope for households on a tight budget.

A practice known as the energy game grid is on the rise, and it adds hundreds of millions of energy costs each year. The Government has the power to intervene

The "game" implies that energy wholesalers play the extremely complicated and highly regulated energy price system of the Australia to raise the cost of energy

The Grattan Institute said that this practice – although "contrary to the intention of the system" – is currently allowed by the rules current.

After the release of the report on Sunday, the government quickly promised to fix the problem. 19659002] "I will write to the AEMC (Australian Energy Market Commission) in light of this report asking them to further investigate the allegations of this behavior, and that they recommend new rule changes if necessary, "said Energy Minister Josh Frydenberg. ] Why high energy prices are here to stay

But while the government and regulator can theoretically tackle the so-called "games," the Grattan Institute even suggests that Between 1965 and 2017, the cost of wholesale has exploded and more than doubled, from $ 8 billion to $ 18 billion a year.

In 2017 alone, consumers paid 20

The main causes were not the game, but rather the rising cost of resources such as gas and coal, and the decrease in the price of electricity. supply through the closure of the generators.

Grattan estimated the closure of The North Power Plant in South Australia in 2016 and the Hazelwood Generating Station in Victoria in 2017 have reduced supply to the point of a $ 6-billion increase in the cost of power generation. wholesale energy.

Gas and Coal Price Increases As the graph below shows, these two factors account for most of the increase in wholesale prices.

"These two problems are far beyond the control excess supply, because of the historical overpopulation, is disappearing, gas prices will remain higher than that. They were not in the past, and new producers using any technology – including coal – cost "Politicians should tell Australians the hard truth: high prices for wholesale electricity are the new standard, "warns the report.

million. Frydenberg disputed this claim, saying that wholesale prices had already fallen by 30% this year. result, he claimed, from the government policy.

"Other falls are also planned with the National Energy Guarantee." Independent modeling by the Energy Security Council shows that wholesale electricity prices will drop an average of 23 percent. % by 2030. "However, this would not bring prices to levels close to those of 2015.

According to the Grattan Institute, games of chance occur when the Wholesale electricity producers – whether it be public or private companies like AGL and Origin – are using their power in concentrated markets to create an artificial scarcity of supply . Apparently, Queensland and South Australia are the worst for that, but they also began to increase in Victoria and could increase in New South Wales.

This happens when there is an unexpected power shortage, due, perhaps. In response to such shortages, the national energy market is asking electricity producers to issue new bids on the amount they want to charge retailers for their electricity.

In this case, the most competitive bid wins. But because of the temporary shortage, there is much less competition, which raises the stakes.

In markets with relatively few power producers, producers are able to artificially inflate prices because they are not very competitive. And it's 'game'.

(The Australian Energy Regulator, it should be noted, does not recognize the term "gaming".)

The Grattan Institute warned that the old plants are closing and not are not replaced, opportunities for game generators would increase. This, he said, was an emerging danger in New South Wales