Millions of Australians could save hundreds of dollars on their power bills after the national energy regulator proposed cuts to electricity prices for large parts of the country.
The Australian Energy Regulator (AER) has proposed changes to its default market offer, which sets the maximum price that retailers can charge for electricity in NSW, Queensland and South Australia.
In relieving news for households being smashed by rising interest rates and cost-of-living stresses, residential properties could see their power bills fall by up to 10.1 per cent in some regions.
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Businesses are in line to save even more, with power prices for small businesses in NSW potentially falling by more than $1300 under legislation set to come into effect at the start of the next financial year.
The AER stresseD the amount of money wiped from electricity prices would depend on location, but said millions of Aussies would still benefit from much-needed financial relief.
Under the proposed changes, residential power bills in NSW would fall by between 2.4 per cent to 8.2 per cent, which would lead to savings of up to $226 per bill, with residents in south-east Queensland in line to save up to $216 per power bill, with businesses also potentially in line for their bills being reduced by 12.8 per cent, or $550.
The AER estimates residential power bills will decrease by around 1.3 per cent.
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The changes are the steepest since Russia's invasion of Ukraine in 2022, where the cost of coal and natural gas soared.
"The reductions reflect easing costs across parts of the electricity supply chain, particularly wholesale energy where we've seen falling electricity contract prices, reduced spot price volatility, and increased output from wind and battery generation," AER Chair Clare Savage said.
"Retailers have also reported lower retail operating costs, while reductions in the cost of environmental schemes have also had a positive impact on reducing prices."
The draft figures will be presented to stakeholders for consultation, with a final decision to be made in late May.
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Savage said the AER was keeping a close eye on events in the Middle East, which has led to a rocketing of the price of oil and concerns about supply.
"While Australia continues to invest in new sources of renewable energy, our electricity system remains significantly exposed to the international price of fossil fuels such as coal and gas," Savage admitted.
She said the above discounts had not taken into account the beginning of the conflict, and warned changes could be made based on what happens in the next couple of months.
"We will continue to monitor this closely before making our final determination of the Default Market Offer in May," she said.
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