By Gavin Dufty
June 3, 2022 — 5.00am
There has been much chatter and hand wringing this week about higher gas and electricity prices, and while households may not have seen these price increases in the mail or in their inboxes just, yet I’m sorry to say they are coming.
For gas, I believe households will see rising prices in the not-too-distant future. In January, we were already starting to see gas companies agitating for increases, with some companies repricing contracts with increases of up to $150 for the coming year due a rising gas commodity price and supply issues in Victoria.
The price of gas is expected to increase soon.Credit:John Woudstra
Of course, these increases will become more pronounced as we head into winter – a season where households traditionally spend more on utilities in trying to keep warm, further exacerbated if you’re working from home.
For electricity, the Essential Services Commission Victoria regulated prices increases of an average of 5 per cent and the Australian Energy Regulator increased electricity prices for default contracts from 6 per cent to 19 per cent. These price increases will kick in on 1 July this year.
While these price increases are for default/regulated offers which few households are on, they flag the types of increases that the bulk of households are likely to see as their energy market offers expire. These repriced market offers will start to appear post 1 July, as we move into the new financial year.
These energy price increases are a particular issue for Victorian households which, unlike other states and territories, tend to have both gas and electricity connections (about 75 per cent of households across the state have both), so we get hit on both fronts.
There is growing pressure on household budgets as the cost of fruit and vegetables rises.Credit:iStock
Meanwhile, families and individuals are dealing with spiralling food, transport, housing, education and health costs that have really put the squeeze on already tight household budgets.
The burden of increased utility prices is felt disproportionately by people on low incomes. The volunteers in our Vinnies Box Hill Welfare Assistance Centre hear from such people – who often call us in crisis, having to choose between keeping the lights on or putting food on the table – on a daily basis.
So what can people do? Get onto the government comparison sites – Vic Energy Compare or Energy Made Easy (they will not be the first result on a search engine so scroll down), and do a health check on your current energy bills. See if you can find a better deal and lock it in for 12 months.
If you are entitled to an energy concession, such as a health care card or pension card, in Victoria that’s a saving of 17.5 per cent of your electricity bill all year round and 17.5 per cent off gas from May to November, so call your retailer to make sure that you are registered for the scheme.
Bill shock can also be managed by asking your retailers to send you more frequent billing to avoid receiving those big frightening bills.
If you are struggling to pay bills, there are strong obligations on retailers to provide various forms of assistance to help so don’t be shy to call – retailers are obliged to help, and I assure you that you most definitely won’t be alone in calling for help.
At home, you can do a number of things to save money. Trying not to overheat a home can save a significant amount of money – e.g. heat smaller spaces and at a lower temperature, and try to close up as many drafts as you can otherwise that’s just heat and, ultimately, your money leaking out of your home.
Other ideas include, installing energy-efficient lighting, washing clothes in cold water, switching off appliances at the wall and improving your home’s insulation.
There is also some good news on the horizon. In July, all Victorian households will be eligible for a $250 power savings bonus payment available through the Vic Energy Compare website.
I wish I could say that the pain will be short-term pain, but unfortunately the projections suggests that these increases will be with us for a while longer. So prepare yourself and your home. It’s going to be a long, cold winter.