WA households could be hit with flat electricity price increases of more than 15 per cent over the next three years as the State Government shores up power provider Synergy’s financial position.
After consumers were stung with an 11 per cent increase in power bills this year, Energy Minister Ben Wyatt signalled the Government was aiming to repeat the dose in coming years.
Mr Wyatt told a Budget estimates hearing into Synergy that the forecast improvement in the power supplier’s bottom line for this financial year was largely because of the decision to impose the price increase on “fixed” charges.
For residential customers, this is the supply charge and is separate from consumption charges.
It was increased to 98.9¢ a day from 48.6¢ last year — an increase of $169 a year. A typical household power bill is $1722 a year, according to Treasury.
With assumed price increases in the State Budget of 7 per cent, 5.6 per cent and 3.5 per cent between 2018-19 and 2020-21, Mr Wyatt said “there is probably still more to come” in Synergy’s shift towards a greater reliance on fixed charges.
He said that the changes announced as part of the Budget had slashed the State-owned utility’s operating subsidy — which will fall from $280 million last year to a forecast $146 million this year and zero next year.
“This has been a big part of the tariff reform that we did earlier to try to get more into the fixed charge and there is probably still more to come when more of the tariff needs to be attached to the fixed charge,” Mr Wyatt told the hearing.
“That 10.9 per cent increase allocated and tied to the fixed charge went a long way … in securing the revenue flow for Synergy.”
Until this year, about 80 per cent of the average annual power bill was based on consumption.
Critics claim the situation is inequitable because some households have been able to avoid higher consumption charges by installing solar panels or energy efficient appliances.
The WA Council of Social Service said the changes disproportionately affected poorer households because they lacked the means to minimise their exposure. Its chief executive Louise Giolitto called on the Government to ensure low-income households were properly compensated for further rises.