$270 electricity hike

The ACT Independent Competition and Regulatory Commission has determined a 17.74 per cent price increase, even more than the 17.22 per cent it proposed in its draft pricing decision of April 5.

Acting senior commissioner Mike Buckley said the increased cost to ACT households was largely attributable to increases in the wholesale cost of electricity with a smaller contribution from network fees. The increase in the cost of wholesale electricity was almost entirely attributable to the introduction of a price on carbon by the Australian government.

The terms of reference to the commission from the ACT government had required the commission to set a price direction from July 1 this year to June 30, 2014.

Its final price direction, issued today (June 8) was only from July this year to June 30 next year.

Mr Buckley said that before preparing a price direction for 2013-14, the methodology might need to be reviewed to account for market developments and any other changes in the way retailers and generators contracted with one another.

The commission estimated that under the new tariffs, a typical ACT household would pay about $273 more a year for electricity. About 80 per cent of this is attributable to the carbon tax.

In April, commenting on the draft price direction, ACT Environment Minister Simon Corbell said that despite the proposed increase, the cost of electricity in the ACT would remain on average almost 30 per cent less than in NSW.

He said then about 80 per cent of Canberra households would receive carbon tax compensation from the Commonwealth that would help cushion the price increase. On average, Canberra households would receive about $600 from the federal government.

Mr Corbell said the ACT government had provided low-income households more than $226 a year to help with electricity costs.