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Wholesale gas and electricity prices on the way down

10 February 2020

Latest energy price data is good news for Australian families and businesses, as wholesale electricity and gas prices continue to fall according to new data from the Australian Energy Market Operator (AEMO).

Over the last three months, average wholesale electricity prices in the National Electricity Market (NEM) fell $40.14 per megawatt hour (MWh) or 35 per cent relative to the same period last year:

Figure 1: Average Wholesale Electricity Prices

Last 3 Months

NSW

Qld

SA

Vic

Tas

NEM Average

1 Nov 2019 - 31 Jan 2020

$91.43

 $60.90

 $72.70

 $90.77

 $59.10

 $74.98

1 Nov 2018 - 31 Jan 2019

$95.68

 $87.32

 $144.06

 $146.65

 $101.88

 $115.12

$ difference

-$4.25

-$26.42

-$71.36

-$55.88

-$42.78

-$40.14

% difference

-4%

-30%

-50%

-38%

-42%

-35%

With wholesale costs making up around a third of residential electricity bills (and far more for industry), these price falls are expected to result in savings for Australian families and businesses.

Prices have also fallen in the east coast gas market, down $3.57 per gigajoule (GJ) or 35 per cent relative to the same period last year:

Figure 2: Average Wholesale Gas Prices

Last 3 Months

Syd

Bri

Adl

Vic*

East Coast

Average

1 Nov 2019 – 31 Jan 2020

$6.78

 $5.96

 $7.25

 $6.66

 $6.66

1 Nov 2018 – 31 Jan 2019

$10.54

 $10.11

 $10.40

 $9.88

 $10.23

$ difference

-$3.77

-$4.15

-$3.15

-$3.21

-$3.57

% difference

-36%

-41%

-30%

-33%

-35%

The key challenge is ensuring that wholesale price savings are sustained and passed on to consumers. ACCC monitoring of the NEM and east coast gas markets until 2025, and the Government’s ‘Big Stick’ legislation are intended to ensure that savings are passed on to consumers.

The Government’s record on energy affordability includes a $1 billion Grid Reliability Fund to support investment in new energy generation, storage and transmission infrastructure, and securing a commitment from the New South Wales Government to inject an additional 70 petajoules of supply into the east coast gas market annually.

View our energy policy blueprint here: https://www.energy.gov.au/energy-policy-blueprint-fair-deal-energy.

Analysis was conducted by the Department of Industry, Science, Energy and Resources of AEMO data.

Media contact: Minister Taylor's office 02 6277 7120