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Electricity retailers raise fixed charges to recover costs after record highs in spot market

Natalie, from Tweed Heads in northern New South Wales, has cut her electricity usage to the bare minimum.

“I don’t run a heater, I rug up … I don’t have a telly and I’m very careful about closing all the curtains,” she said.

“I’m doing pretty much as much as I can to reduce my electricity.”

Natalie is on a disability pension, so money is tight.

Woman in blue checked jacket sits on a blue couch
Natalie wears two jumpers instead of turning on her heater(ABC News: Steve Keen)

Like many people, she recently received notice that her electricity bill will be going up.

The usage component of her bill is only going up to a few cents, but the fixed rate part — the daily supply charge — is going up to 43 per cent.

“I understand everyone is getting a price increase,” she said, “but it just feels a little bit unfair that they’ve put so much on the daily rate.

“I can’t reduce my electricity consumption to reduce the daily rate.”

The New South Wales Energy and Water Ombudsman, Janine Young, said every customer would be seeing price increases.

“Some energy retailers are saying [it will be] as much as 20-30 per cent more,” she observed.

A woman with dark hair and dark glasses looks off-camera.
NSW Energy and Water Ombudsman Janine Young says all customers will be in for a price hike.(ABC News: John Gunn)

Wholesale prices are at record highs, tripling in the three months to June, compared to the same time last year.

The Australian Energy Market Operator (AEMO) said it was because of high commodity prices, coal-fired power outages and a cold east coast winter.

However, Ms Young argued, those increases should flow through to the usage charge — the cents-per-kilowatt on a customer’s bill — instead of the fixed daily supply charge.

“Retailers can charge an additional amount in that fixed part of your bill. And that’s not price-capped [in NSW],” Ms Young explained.

“It could be that some retailers are increasing that element to offset the wholesale price increases that they’re wearing.”

Different states and territories regulate energy prices differently, observed the Australia Institute’s climate and energy director, Richie Merzian.

A large power plant blowing smoke with green rolling hills in the foreground.
Coal-fired power still makes up a large portion of Australia’s total electricity generation.(ABC News: Freya Michie)

“The regulated daily supply charges are in Western Australia, Northern Territory and regional Queensland. For Victoria, New South Wales and the Australian Capital Territory, that price can float and can continue to go up,” Mr Merzian said.

Energy market ‘struggling with its own resilience’

The peak body representing power companies, the Australian Energy Council (AEC), has defended the price hikes.

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Business

High-voltage powerline projects spark mixed emotions across regional Victoria and NSW

The mouth-watering scent of freshly baked baguettes mingles with irresistible wafts of buttercream and powdered sugar.

Smartly dressed customers alternate delicate bites of mille-feuille with sips of café.

row of french pastries and baguettes inside cabinet at store
Le Péché Gourmand’s pastries are a favorite among Creswick locals and tourists.(ABC Ballarat: Lexie Jeuniewic )

Everything about Creswick’s Le Péché Gourmand Boulangerie-Patisserie whispers provincial France, but a bold red sign in the corner of the shop front screams western Victoria:

“Stop AusNet’s Towers. Join the fight.”

The town and surrounding district’s push to halt plans to construct above-ground powerlines for AusNet’s Western Renewables Link has been running for years.

Handmade protest signs are fixtures on farm gates, fences, and in businesses throughout the region; even the Big Spud on Ballarat-Daylesford Road has its own “Piss Off AusNet” placard.

Country road in western Victoria with ute and roadside potato shop on the left
Signs opposing AusNet’s Western Renewables Link are a common sight across western Victoria. (ABC Ballarat: Lexie Jeuniewic)

In March, local farmers opposing the project rallied at Parliament House in Melbourne, and most recently drove tractors through Ballarat’s CBD.

Le Péché Gourmand co-owner Marie Williams says she fears it is these farmers who could pack up and leave the region if AusNet’s plans go ahead and, consequently, crush her customer base.

“We’re really worried about it, to be honest,” Ms Williams said.

“If the farmers aren’t there anymore, we lose half our customers.”

woman in brown dress with slight smile stands in bakery
Creswick business owner Marie Williams is concerned about the impact the transmission lines will have on the region.(ABC Ballarat: Lexie Jeuniewic)

Ms Williams and her husband moved from Sydney to Creswick 10 years ago to escape city life. She said the Western Renewables Link would puncture the town’s bucolic surrounds with unsightly towers, turning off tourists.

“Looking at towers isn’t the most pleasant thing. It’s hard to grasp how far it’ll go and how much it’s going to affect the region,” she said.

More transmission lines on the horizon

Last week further plans for another transmission line through western Victoria were released by AEMO (Australian Energy Market Operator) and Transgrid.

map of planned transmission lines across Victoria and part of New South Wales
VNI West is designed to connect to other projects, including the Western Renewables Link. (Source: AEMO)

Pitched as a once-in-a-lifetime opportunity by the energy operators, the Victoria to New South Wales Interconnector West (VNI West) power link aims to allow the two states to share electricity.

AEMO spokesperson Jonathon Geddes said the development would “increase network resilience, energy reliability and put downward pressure on electricity prices for homes and businesses”.

Councils divided

Under the plan, 500 kilovolt (kV) double-circuit overhead transmission lines would snake from the Snowy Hydro grid in New South Wales, through to a proposed terminal station at Newlyn, in the Hepburn Shire.

Woman with short hair, wearing a white shirt and black jacket, smiling standing among trees
Mayor Ruth McRae urges locals to join the consultation process.(Supplied: Murrumbidgee Regional Council)

Ruth McRae, the mayor of Murrumbidgee Shire Council in the Riverina, said the council “fully supports strategies to generate and deliver affordable and secure energy to our nation.”

“Energy costs form a large part of the household budget so most people would support this concept,” Councilor McRae said.

She stressed, however, that the project’s “greatest impacts are borne by local landholders and community.”

“This project affects us all and we urge the community to get involved with the consultation process and make their views known,” she said.

red sign which reds stop ausnet's towers in window of Creswick business
The sign in the window of Le Péché Gourmand sends a strong message.(ABC Ballarat: Lexie Jeuniewic )

Hepburn Shire Council — which takes in the towns of Clunes, Creswick, Daylesford, Hepburn Springs and Trentham — has voiced strong opposition to the proposal, echoing its stance on the Western Renewables Link.

Deputy Mayor Jen Bray told ABC Ballarat Breakfast the council was “not opposed to renewable energy”, but how it was delivered was important.

She said the council was seeking an underground solution for the powerlines, along with a different location for the transmission station proposed for Mount Prospect in the village of Newlyn.

sign with red cross over transmission lines and towers on farm gate fence
Hepburn Shire Council is concerned about the Western Renewables Link and VNI West.(ABC Ballarat: Lexie Jeuniewic)

“It’s going to set up Hepburn Shire as a central hub for a series of lines that could be radiating out, much like the spokes of a cartwheel,” she said.

“It’s not really what you want in an area where you’ve got high-quality, premium agricultural land.

“It’s not what you want in an area where your main tourism economy is reliant on beautiful, pristine landscapes.”

But Mr Geddes said high-voltage underground lines along the full length of the project was “not economically justifiable”.

“We acknowledge the importance of considering all reasonably practicable route refinement options, which may, in exceptional circumstances, include partial undergrounding short distances,” he said.

Tractors in Ballarat
More than 70 tractors took to the streets in Ballarat to protest the Western Renewables Link.(Rural ABC: Jane McNaughton)

Projects ‘can be done better’

If the projects come to fruition as planned, Newlyn potato farmer Kain Richardson’s property will be surrounded by transmission lines, and have the VNI West transmission station at his “back doorstep.”

“There’s been no consideration given to the people,” he said.

Mr Richardson, a fifth-generation farmer, said neither proposal was utilizing “modern-day technology”.

cloudy horizon from farm with sheep on mostly green grass
Farmer Kain Richardson’s property in the town of Newlyn. (ABC Ballarat: Lexie Jeuniewic )

“We’ve moved on from the time [transmission towers] were built in the 1960s. Do you want to go back to leaded cars?” he asked.

“Why is transmission being left out of the technology advancements, and landholders have to accept that? It’s not on.”

Mr Richardson said he was yet to receive any communication from AEMO or Transgrid about the VNI West project since the project assessment draft report was released.

“It leaves a lot to be desired,” he said.

AEMO Victorian Planning and Transgrid will hold online information sessions on August 10 and August 25. Registration is required.

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