Electricity prices on Australia's east coast and southern states may rise early next year as gas prices rise. (photo by Aussie)
According to the Australian Journal of Consumer Protection, the energy experts warned that this could lead to a rise in electricity prices at the beginning of the year, the East Coast of Australia and the southern states, according to the Australian Journal of Consumer Protection. South Australia, which was the top of the world's highest price, will be hit with the biggest blow.
This week, Australia's Competition and Consumer Council, (ACCC), announced for the first time the price of LNG imports to help major gas users negotiate better contracts.
Gas prices will continue to rise to about A $15 a Joule this summer, and prices will not fall below A $10.6 for the rest of the year, the committee predicts.
(Nathan Vass) (Nathan Vass), executive director of Australia's energy project (Australian Power Project), said data from the committee showed that domestic gas prices could rise to A $15 a joule in January and February next year. This year's average price is more than 40% higher than this year's average A $10.68. This will have a great impact on the price of electricity.
He said the commission's modeling results showed that for every A $1 rise in the price of gas per Joule, wholesale prices could rise up to A $11 per megawatt-hour. South Australia will be hit hardest. The state currently has an average price of A $90 per megawatt hour at a gas price of A $10 per joule. If gas prices rise to A $15 a joule, the price would reach A $140 per megawatt hour.
He noted that the closure of cheap and reliable coal-fired power plants and the switch to gas-fired plants made South Australia more vulnerable to electricity prices than other states.
Wood (Tony Wood), head of (Grattan Institute) 's energy program at the Gratham Institute, said the price increase depends on the amount of gas needed, which in turn depends on weather conditions that require more gas if there is no wind or sunlight.
However, federal energy secretary Taylor (Angus Taylor) said rising gas prices would have little impact on higher electricity prices in a competitive market. The government expects retailers to bring low electricity prices and will pay close attention to their actions.