The Australian Energy Market Commission (AEMC) has released figures which suggest that there may be relief in sight for manufacturers when it comes to electricity prices.
Modelling produced by the AEMC suggests that small businesses could save 7.1 per cent over the three-year period to 2022 as 5,000 MW of supply comes on board. This increase is equivalent to the output produced by two and a half of Australia’s largest coal-fired power stations.
The price decreases are driven by, in order of significance, addition generation entering the market, the lowering of network prices due to falling distribution costs, and falling green scheme costs due to cheaper large-scale generation certificates for renewables.
“While the overall national trend is down all across the supply chain there are regional differences across states and territories that will affect price outcomes depending on where you live and how much electricity you use,” said AEMC Chairman, John Pierce.
The modelling by AEMC indicate significant variations based on location over the three-year period. South east Queensland will have estimated drops of 20 per cent, the largest decrease. NSW has falls estimated at eight per cent, while Victoria could experience decreases of five per cent. South Australia will have the least change, with a two per cent fall, or an average change of 0.5 per cent.
Western Australia, however, may experience price rises, estimated by the AEMC at six per cent, although due to being separate from the National Energy Market (NEM), the price outcomes may be different, noted the AEMC in a statement.
“More supply puts downward pressure on prices. But it’s important to note that over a decade of analysis we have seen trends change sharply in response to factors such as sudden generator closures and implementation of new policies. As such, all price projections should be seen as just that, projections,” said Pierce.