Three hours of free power for everyone from July – but there’s a catch
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The government is under attack from the opposition over rising energy prices. Since the Albanian government was elected in 2022, bills have risen by nearly 30 per cent in NSW and 20 per cent in Victoria, despite an election promise to cut electricity bills by 2025.
Electricity bills have risen due to rising fossil fuel prices, as well as the cost of operating Australia’s aging fleet of coal-fired power plants and the late commissioning of wind farms.
The last round of state and federal electric bill subsidies will expire by the end of the year, and it is unknown whether they will be renewed. Since its inception in 2023, its cost to federal taxpayers has reached $5 billion.
Meanwhile, electricity prices rose 9 per cent last quarter, according to the Australian Bureau of Statistics; This contributed to a 1.3 per cent rise in inflation in the September quarter, taking the annual rate to 3.2 per cent.
The Solar Sharer plan will be available to customers in NSW, South Australia and south-east Queensland, where AER has established reference power plans, from July next year. The federal government also aims to offer the deal in Victoria and Western Australia, where state governments set the floor price.
AER chief executive Clare Savage said the plan could reduce the cost of running the electricity grid.
“Shifting more demand to midday will lower the cost of the electric system for all consumers because we won’t have to build as much generation or poles and cables to meet the evening peak,” Savage said.
Solar power floods the east coast power grid in the middle of each day, and the wholesale costs that retailers pay to generators for supply often reach negative prices around noon.
This abundance of solar energy is forcing authorities to restrict the energy fed into the system to prevent dangerous voltage spikes that could lead to power outages.
The glut has also reduced demand for residential rooftop solar from energy retailers; That means the feed-in tariff offered to households with solar panels has fallen from about 20 cents per kilowatt-hour to 5 cents or less over the past decade.
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The Solar Sharer plan is designed to increase daytime energy consumption and absorb some of the excess during the noon hours.
It will also help change usage patterns and reduce electricity demand in situations where the grid is strained after 5pm due to reduced solar energy and households turning on their devices.
Department of Energy analysis found that a large household would save about 28 percent on its bills by shifting 25 percent of its electricity consumption to a free period. The average household bill in Sydney is around $2000. In Victoria the average is around $1700.
