Thousands of Victorian families are facing higher electricity bills following Red Energy’s recent price hike. This move comes as part of a broader national trend of rising energy prices, putting even more strain on household budgets already impacted by cost of living pressures.
In a difficult decision for the utility provider, Red Energy, owned by the government’s Snowy Hydro, confirmed an increase of just over 4% in electricity prices for customers in Victoria, affecting an estimated 230,000 homes. This will see power bills rise by approximately $50 annually.
The rise is in addition to a nationwide hike of up to 9.7% announced by the Australian Energy Market Operator in May, impacting around half a million customers across the country.
Rising Energy Prices Across Australia
The surge in electricity prices is a part of a national trend that has seen the cost of power rise for millions of Australian households. According to the Australian Energy Regulator (AER), power bills are expected to rise by between $110 and $300 annually depending on the state and energy provider.
Major retailers like AGL, Origin, and Energy Australia have followed suit with their own price hikes, exacerbating the financial strain on families across the country.
In Victoria, Red Energy’s 4% increase is comparatively lower than the steep 15% hike seen in New South Wales, where power bills are significantly more expensive. Despite the smaller rise in Victoria, this price change will still add pressure to households, many of which are already grappling with the rising cost of living.
As Red Energy cited, the decision to raise prices was influenced by increasing wholesale and network costs, which make up a large proportion of a customer’s energy bill. The company stressed that its energy packages would remain competitive, despite the price increase.
However, with a growing number of Australians already in energy debt—over 215,000 according to the AER’s latest data—the impact of these increases is expected to be felt most acutely by vulnerable households.
Government Energy Rebates and Policy Response
Alongside rising energy prices, federal energy rebates have been significantly reduced, further undermining efforts to shield families from the rising costs. The federal government recently halved its energy rebates from $300 to $150, which only partially compensates for the impact of the price hikes.
The reduction in rebates adds another layer of financial burden for low and middle-income households, many of which were already struggling before the price increases.
Energy Minister Chris Bowen, in his recent comments, reaffirmed the government’s commitment to implementing a more effective pricing mechanism to help curb rising electricity costs.
His emphasis on expanding renewable energy sources, such as rooftop solar and battery storage, highlights the long-term policy direction. However, for many Australians, the immediate issue remains the affordability of their power bills, with no clear relief on the horizon.
