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What will the new Government mean for business power prices?

Whether you’ve been keeping up with the to’s and fro’s, or you’re just relieved the election is over so you no longer have to hear those election ad ear-worms, the shift from a Liberal to a Labor Government does not come without some potentially enormous shifts to how the future with roll out for all Australian businesses.

In a country where climate, renewables and energy sources have long been politicized, we have already seen policies and pledges that seem to speak to these issues, but ultimately please none. But can a pledge make a difference to the rising costs of energy, and growing sustainability issues? And what will it all mean for Australian business owners?

An end to “the climate wars”

While some make have taken Anthony Albanese’s words as a touch of hyperbole, it is undeniable how wrathy the topic of climate has truly been within our government and opposition. With the most recent IPCC report suggesting a significant shift required in the Government attitude and approach to climate change, as well as a population demanding more to be done, a strong and confident climate policy has severely lacked. And not just from the most recent Liberal party, who were on track to fail on their own very generous terms: In 2013 the coalition spun the Labor government’s carbon pricing mechanism as a tax, a seemingly successful tactic that saw the coalition take the driver’s seat.

Fast forward nearly ten years, and it is clear the majority of Australian people feel strongly about climate action in its various forms, while the Coalition remained heavily divided on the topic, insofar as causing infighting. According to the Lowy Institute, three-quarters of Australians (74%) say ‘the benefits of taking further action on climate change will outweigh the costs’, with an upswing in the success of sustainable brands and products suggesting this is a topic close to the hearts of many.

So what does the end of these wars look like? Labour’s pledge is to cut carbon emissions by 43% by 2030, and boost renewables and electrical vehicles through tax breaks, as well as assisting in building community-owned solar power and battery projects. Do these benefit, or potentially hinder everyday Australians businesses?

The over-performance of renewables

If you’ve read any of our recent articles, you will know that stable, affordable and predictable energy is very much the topic of the moment, and unfortunately not for positive reasons. So far in the last 18 months alone, we have seen the expedited closure announcements of three major coal power stations: Eraring, NSW’s largest station, Yallourn and Liddell.

While the lack of reliability and cost of maintenance on these ancient structures is clear, a more pressing factor behind the closures is simply that of making money versus losing it. Younger and more nimble sources of renewable energy are outpacing these coal based monoliths with not only their reliability, but also their ability to shift with the change of demand throughout the day, months and seasons, allowing energy providers to have a level of nuance and control previously unheard of. Combined with their sustainable nature, providers are moving to renewables to continue to provide the National Energy Market with the power we need for a growing population.

Simply put, this means that choosing a renewable-focused future isn’t just about choosing what’s “right”, but also what is most economically feasible.

Where this may affect the everyday Australian is in the process of doing so: The gap between creating these renewable options and needing them is at present quite vast, bringing us into a market that is unsteady in the face of rising demand. Add to this some overseas conflict influencing gas and petrol, and local natural disasters, and we have a network limping to the finish line, with the ultimate cost falling to energy users in both business and residences.

After all, if the wholesale cost of energy is high due to low supply and growing demand, there is only so much a retailer can do to avoid the pinch - they are a business themselves, after all, and need to see a return on their service.

So how can the new government help?

Unfortunately gas and electricity were privatised in Australia some time ago, meaning that government intervention is perhaps not as capable as you might first think. The influence we anticipate to see in the coming years by Labor are more on expediting much needed renewable opportunities, rather than offering relief to individuals watching their energy costs grow. And to that, we look on optimistically.

These higher costs are unfortunately a bit of a legacy outcome, reflecting years of deferred focus on the inevitable demise of our coal power stations, and may take some time to correct. However you may feel about politics, coal or climate, the fact remains that a price increase remains on the cards, with no evidence of possible relief in sight.

Your empowering alternatives

But all is not lost - our team of energy brokers and solar specialists are here to help and continue to assist businesses every day to stem the flow, offer alternatives to grid power, and ensure their energy usage and bills are as optimised as possible.

An important emphasis we are currently underlining is for businesses who have previously explored or overlooked solar for their commercial site return their attention to the opportunities at hand. Between the unlimited Instant Asset Tax Write Off, rebates and incentives to each state, and the growing concern of rising energy bills for years to come, empowering your business with your own sustainable source of energy that reduces grid reliance can often be a cash flow neutral or positive opportunity.

Whether you are a large or small energy user, it is simple and obligation-free to learn more and see how we can help you with these ongoing concerns.

Call us directly on 1300 304 448 or get in touch here today.

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