Electricity price could rise in 2019

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A forecast from the Australian Energy Market Operator suggests electricity prices could rise by as much as 10 cents per kilowatt hour (kWh) in 2019.

The EEMO forecast shows wholesale electricity prices at $2.60 per kWh, down from $2,742 in 2016, while peak wholesale prices of $2 per kWh will drop to $2 a kilowatthour.

“There is more uncertainty over the electricity market in 2019,” EEMI chief executive David Macdonald said in a statement.

Mr Macdonald is due to present the EEMOs outlook on Monday.

He said the EemO forecast showed electricity prices “will not rise in the forecast period”.

“The EemOs outlook for the electricity markets shows no increase in wholesale electricity rates, but there will be higher costs to pay for grid generation and to deliver new generation in 2020,” Mr Macdonald wrote in a blog post.

The EEmO forecast includes changes to electricity pricing.

It looks at how wholesale electricity bills might be affected by changes to the wholesale electricity market, such as increased demand and supply from the wind farm and solar farm, as well as changes to retail electricity prices, including the impact of windfarms and solar farms on their customers.

“It is the case that wholesale prices may rise, but these increases will be offset by lower wholesale prices paid to the retail electricity market,” the EEmo forecast says.

In 2017, the EMA forecast wholesale electricity markets to be “much more flexible” compared to the past.

EEMO also projects electricity prices will fall over the coming years.

But it warns that “a sustained increase in the wholesale prices for wholesale electricity, as is happening in the past, could have negative consequences for consumers”.

Electricity prices are expected to rise from the $2 level in 2020, to $4 per kWh by 2025.

Wholesale electricity prices are also forecast to fall by between $2 and $3 per kWh between 2021 and 2040.

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