Solar energy pulls down South Australia's power prices

South Australia's pricing regulator is recommending an 8.1% cut to power bills.

The growing demand for alternative energy is seeing less pressure on the Australian Energy Market Operator, which is responsible for administering the country’s wholesale electricity costs.

A recent draft report by the Energy Services Commission of South Australia (ESCOSA) indicates the changes would would only affect some AGL SA customers, other state bodies will be prompted to investigate their own wholesale pricing calculations.

South Australia has the highest uptake of solar power in the country with almost 2.5% of the state’s electricity collected from PV panels on residential and commercial rooftops. This, along with more than a quarter of the SA’s electricity being generated from wind means less demand on conventional electricity networks.

ESCOSA has also implemented the preferred ‘Energy Purchase Cost’ method of calculation, which is more in line with current costs. Subsequently, the commission recommends AGL SA customers with ‘standing contracts’, approximately 25% of their residential and small business customers, receive an 8.1% cut.

This wil help the average household save around $160 a year.

“The wholesale cost represents about a third of a typical residential electricity bill, so the proposed reduction will have a visible impact next year for those on standing contracts. This would benefit customers who have seen electricity prices rise quite significantly over the past three years,” said Paul Kerin, CEO of ESCOSA.

For more.