June 22, 2008
AS if families across NSW weren't doing it tough enough already, the state's electricity prices will go up by another $90 a year.
As Premier Morris Iemma lobbies Labor and State Parliament to embrace a power privatisation, the independent pricing authority yesterday increased electricity prices by up to 8.5 per cent from July 1.
It comes on the back of an increase of $245 a year in water bills by 2012 announced on Monday.
Add rising petrol prices, interest rates and soaring costs of living into the mix and families are finding themselves worse off than ever before.
"Electricity and water are the necessities of life and we're really starting to see the enormous pressure on families and individuals from increasing charges on these necessities," Salvation Army spokesman Pat Daley said.
"We've already seen people cutting back on entertainment and luxury items and now these essentials are starting to hurt.
"There is a working poor emerging, particularly in Sydney, and we are now seeing this demographic presenting for help and it is putting quite a bit of pressure on the welfare groups."
The increases will apply to both residential and small business customers.
A typical EnergyAustralia or Integral Energy customer on regulated tariffs can expect to pay between $1.40 and a $1.70 extra a week for electricity from the beginning of next month.
Country Energy customers will pay an additional 60-80 cents a week on average.
IPART chief executive Jim Cox explained away the rise as necessary to provide for increased costs in purchasing electricity purchase costs and improvements to network reliability.
"Increases are needed to ensure the NSW residents and businesses continue to have access to a safe and reliable supply of electricity," Mr Cox said.
"Retail prices need to be sufficient to recover the costs incurred in selling electricity, and the investments made in the transmission and distribution networks to increase reliability standards and meet peak demand."
And there is no relief in sight, with energy emissions trading set to increase the cost of electricity even further.
When Mr Cox announced the three-year pricing schedule last year, he said the rises were needed so energy companies could reduce greenhouse gas emissions and purchase renewable energy.
Christopher Zinn, from consumer watchdog Choice, said the cost of energy made it essential to start investing now in ways to reduce the utility bills.
"We don't quite know what the emissions trading is going to do but when it begins all these things - new investment in infrastructure, water, gas - will cost more," he said.
"All utilities around Australia are going up and the best advise is to reduce your use where possible and take advantage of rebates on insulation, rain water tanks and solar hot water heating."