Last week was a difficult week for our energy department with many electricity retailers cancelling any outstanding tender contracts (and prices) that had been offered to our clients to protect themselves from the energy spike.
It serves as a reminder to us all that until an offer is signed, and accepted, retailers have the right to cancel before it expires.
If you are looking to renew or extend your current power contract now is still a good time to check the market as we have secured some good deals despite the market movement.
What’s causing the spike in energy prices?
The reason for the spike in energy futures could well be the confusion and continued argument over the National Energy Guarantee (NEG) being debated in Sydney. The NEG has passed the first hurdle, but the extremely low emissions target reduction of 26% in 10 years is cited as far too low. It will be “discussed” again this week.
Last week both Energy Australia and AGL reported huge profit, with AGL tripling their net profit of 2017. AGL has been seen as one of the main culprits in driving up east coast gas prices because of a $2 billion contract it struck to sell gas to Santos’s GLNG project that ended up as exported LNG.
AGL Chief Executive Officer Mr Andrew Vesey on Thursday blamed the surge in electricity prices on the “abrupt” closure of the Hazelwood and Northern coal generators, neither of which was owned by AGL; and higher costs for coal and gas. The same point was made by Cath Tanna, head of rival Energy Australia.
AGL did insist on closing coal fired Lidell in NSW despite pressure from the government to keep it open.
Closing down significant coal fired capacity, without ensuring adequate supply of a greener renewable alternative has caused a national shortage of power at key demand periods, and looks set to cause blackouts again this summer. The Victorian and Queensland Labour governments have indicated they will not sign up, while Liberal governments of South Australia, New South Wales and Tasmania will.
How does the current cost of power compare versus the last three years?
What is the National Energy Guarantee?
News.com.au covers everything you need to know about the National Energy Guarantee and how it affects you.
What is an LGC solar project?
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