After years of substantial electricity price rises in South Australia, a reduction of nearly 10% in household bills will be achieved by application of the Australian Energy Regulator’s (AER) draft determination for the SA Power Network’s revenue allowance for 2015-20. This translates to a reduction of nearly $200 on the average electricity bill, but it will not apply until next year, and requires the AER to confirm this reduction in its final decision, due later this year.

Uniting Communities is heartened by the Australian Energy Regulator’s draft determination knowing that thousands of SA households and some small businesses are unable to pay their electricity bills.

“The main reduction on the proposed regulated allowance, is due to dramatically lower interest rates for capital – the good news of a sluggish global economy. General operating costs and capital costs through to 2020 are in line with current levels of expenditure by SA Power Networks. Their regulatory proposal was for an increase,” said Mark Henley, Manager of Advocacy and Communication.

SA Power Networks sought total revenue of $4745 million for the 5 years from 1st July next year, with the draft regulatory decision being to allow $3211 million.

“The Regulator has made a draft determination that will help to reduce energy stress for SA households and which also should help to reduce energy costs for many businesses, which is a fillip for the State’s economic development. The draft determination is broadly in line with Uniting Communities proposals to the AER, in the lead up to this draft decision,” added Mr Henley.

“While a reduction in network distribution costs for electricity in SA is significant, we also need to keep looking for ways to reduce the wholesale and retail components of electricity bills. Improved energy concessions will continue to be needed for the many families for whom a 10% reduction, after years of increases, is not enough to make energy affordable,” Mr Henley added.

Uniting Communities will make a submission to the AER regarding this draft decision. These are due by 3rd July and the final decision will be made by the Regulator on 31st October this year.