Despite PM's plans, bills to rise

Households to face higher energy bills

a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Households in NSW face another rise in energy bills after EnergyAustralia announced plans to increase prices by up to 10.5% over the next three years.

EnergyAustralia plans to increase prices by 4.5% from July 2013, 3% from July 2014 and a further 3% in July 2015.

The news comes just a day after the Prime Minister, Julia Gillard, announced plans that could see up to $250 shaved off the annual household electricity bill. AGL Energy (ASX: AGK) has also announced plans to increase prices by 10.4% from mid next year.

Related: Complaints spike as energy prices soar

The proposed changes follow a 20% increase implemented from July this year, sparked, according to power companies, by the need to upgrade the electricity network to cope with peak power periods. That has lead to energy suppliers being accused by governments of 'gold plating', or overspending on their network upgrades. The suppliers have countered by saying that state governments have neglected our energy networks for decades. $17 billion is projected to be spent upgrading networks from 2009 to 2014, despite households reducing their usage due to the rising prices.

Companies like AGL, Origin Energy (ASX: ORG), ERM Power (ASX: EPW) and Australian Power and Gas Company (ASX: APK) have also raised prices due to the introduction of the carbon tax. The introduction of solar rebates for solar generated electricity is also being blamed for price rises, with an explosion of households taking up the offers, pushing the costs onto those who have not installed solar panels.

The average household bill has risen 80% over the past five years, and is expected to reach $2,230 this year, according to the Australian Financial Review.

The Foolish bottom line

Some sectors of the media have suggested the easiest way to reduce power bills would be to drop the carbon tax. It seems to me that the real issue was the privatisation of energy assets. State and federal governments appear to have lost real control over the energy industry, and consumers are bearing the brunt of that mistake.

Our "Top Stock for 2012-13" is already on the move, yet we think the stock still has an exciting future ahead. Get the name, ASX stock symbol, and full research case for this remarkable software company FREE! Click here for this brand-new special report.

More reading

Motley Fool writer/analyst Mike King doesn't own shares in any company mentioned. The Motley Fool's purpose is to help the world invest, better. Take Stock is The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it's still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »