Australian households have been grappling with surging electricity costs of up to 30% since July, with little reprieve in sight.
Contrary to the optimism surrounding the transition to renewable energy, the promise of affordable, green electricity remains far off for a considerable number of consumers.
According to the Australian Competition and Consumer Commission, wholesale price hikes are inflating household energy bills.
Clean energy comes at a cost
Highlighting the ongoing impact of the Ukraine war and increased international gas prices, Alinta Energy executive director for retail Amanda Hagan said: "Bad weather and power station outages also contribute to elevated wholesale prices.
“If you have higher fuel prices and fewer power plants online to generate energy, you get a higher cost of energy overall.”
While the prices of solar panels and electric vehicles have been declining, household batteries are more expensive now than they were five years ago, according to Hagan.
“I think the positive takeaway is that every day we’re seeing more options for household electrification hit the market," she said.
“We fully support the transition to net zero, but the cost of getting there will be enormous.
“And everyone investing in the transition needs to earn a modest return on their investment.
“So the brutal reality is the overall cost of energy is probably going to be higher and never go back to the price we all paid for energy in previous decades."
Rooftop solar to the rescue
Energy specialist and Solar Analytics chief executive officer Stefan Jarnason countered, suggesting rooftop solar could cut energy costs by 70%.
For homes without rooftop solar, electricity prices should stabilise in 2030 before declining as more renewable energy sources such as wind and solar come online, Jarnason said, citing reports from the Commonwealth Scientific and Industrial Research Organisation (CSIRO) and Australian Energy Market Operator.
“EVs are also falling in price quickly, and already make financial sense if you drive more than 20,000 kilometres each year.
“By 2026, I expect that half of all new car sales will be EVs.
“The nirvana of a fully electrified and automated home and car, with tiny monthly energy bills, is still a few years away but we are already seeing many of our customers achieve this,” he added.