It’s always fascinating how far media and political narratives in Australia diverge from reality when it comes to the electricity market. This sequence of charts tweeted by this week by Simon Holmes à Court, senior advisor Energy Transition Hub at Melbourne University, helps illustrate the point.
On Monday the ACCC landed the interim report for their Retail Electricity Pricing Inquiry. Hardly friends of renewable energy, the hard-headed economists busted the myth that environmental charges are the driver for higher retail electricity bills.
Nope, environmental charges didn’t even make it onto the podium — with networks taking the gold medal, retailers the silver and wholesale energy prices awarded the bronze.
(Amusingly, ex-IPA energy tsar Alan Moran disputes the figures (as did other Murdoch columnists like Judith Sloan) claiming that:
“Such high and growing retail margins … are not plausible in a market that has the big three heavily competing with each other and something like a dozen other retailers seeking to find gaps and take share from the majors.”
Insert cry-laughing emoji here. Moran thinks the RET is responsible for 60% of rather than a share of the 16%.)
Anyone listening to a politician or reading a major newspaper in the last few months would be led to believe that wholesale energy prices in South Australia are off-the charts.
Yeah, but nah. So far this financial year, there’s very little to separate the states — with Queensland being the notable exception after the state government directed the generators to stop gaming the market. You could forgive consumers for wishing that other states had that power.
(Sorry WA and NT, you don’t feature because you’re not in the wonderfully named National Energy Market and therefore not a part of the data series, available as AEMO’s Average Price Tables.)
In fact, South Australia has only had the highest prices on 20% of the days of this financial year. Given that there are five states, it is hardly shocking for SA to have highest prices on 1-in-5 days.
Nope, line honours go to NSW with 36% — keen readers will be aware that NSW had a late start to grabbing a share of the RET and lags other states.
Of course, it will be interesting to see how these numbers move around as we move into warmer weather over summer.
Giles Parkinson is a journalist of 30 years experience, a former Business Editor and Deputy Editor of the Financial Review, a columnist for The Bulletin magazine and The Australian, and the former editor of Climate Spectator.