Chalmers signals plans to cut prices

“Some of these price increases are already happening,” he said.

“If there’s anything we can reasonably do on energy beyond the substantial steps we’ve already taken, if we can do it to help mitigate some of these price increases, then obviously we’re doing it. ‘will consider.’

Asked if he was prepared to cap energy prices, Chalmers said: ‘I don’t want to point to a preferred path here – that would require extensive consultation with colleagues and with other levels of government and so that’s why I’m not prepared to be more specific.

Finance Minister Katy Gallagher said more action “is needed” as the challenge was probably the biggest issue facing the government after the budget.

ACTU President Michele O’Neil said a “super tax” on gas exporters should be considered as it could fund rebates to households.

“It’s really important to look at the super profits tax and think about how it can be used to provide some relief,” she said.

As pressure mounts on Labor from its own base of support, Energy Minister Chris Bowen will meet his state and territory counterparts on Friday to discuss switching to renewables as the government promises lower fuel prices solar and wind energy.

The AWU wants a meeting of manufacturers, industry groups, consumer groups, unions and gas companies in early November to advocate for intervention by political leaders through the Australian Competition Commission and the consumption or the Australian Domestic Gas Safety Mechanism (ADGSM), the “gas trigger” that can stop exports.

“If we don’t act in the next few weeks, we’re going to see factories shut down,” Walton said.

“Yes, there are a bunch of long-term things the government should be looking at, but, right now, what we need is for the ACCC, or the ADGSM, or both, to get a real power to cap gasoline prices immediately.

“If the government makes this gesture now, everyone wins. The gas companies may complain, but they will be perfectly fine and still enjoying mega profits.

The budget called for a 20% increase in national average retail electricity prices by the end of 2022 and a 20% increase in retail gas prices in that fiscal year.

It forecasts a further 30% increase in nationwide average retail electricity prices in the year to June 2024 and a further 20% increase in retail gas prices in the same year. .

Due to capitalization, the increase in electricity would be 56% over two years, while the increase in gas would be 44% over two years, but the government could intervene before the full impact is realized.

Average household electricity bills were $1,434 last year, according to the ACCC’s latest report. A 56% increase would add $803 over two years.

Average household gas bills were $1,128 nationwide, according to the latest analysis from Australia’s energy regulator based on advice from Frontier Economics. A 44% increase would add $496 over two years.

Victorian customers would be much harder hit by soaring gas prices than others, given that the state’s gas consumption per customer was 49,799 megajoules a year, compared to just 18,384 in New South Wales. and 7,238 in Queensland in AER reports.

The Australian Energy Council, whose members include electricity giants AGL, Origin and EnergyAustralia, said retailer input costs were high due to soaring coal and gas prices and put warns of price caps that could force businesses to close and drive up prices for consumers. even higher.

“It’s those input costs that are high, not the retail margins, which the ACCC said only accounted for 3% of the bill at the end of last year,” said the consultancy’s chief executive, Sarah McNamara.

“While we know customers are tough at the moment, if the regulator sets the price too low, it could trigger a wave of retailer exits from the market, impacting customer experience and driving up prices.”

Samantha McCulloch, chief executive of the Australian Petroleum Production and Exploration Association, said expanding gas production was the best way to reduce gas prices – a message to political leaders to back projects like the gas field of Narrabri in the NSW region.

But McCulloch warned against intervention in the market, saying “ever-changing politics” posed a risk to investment and supply.

Cut through the noise of federal politics with news, opinion and expert analysis from Jacqueline Maley. Subscribers can sign up for our weekly Inside Politics newsletter here.


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