Draft Report - Energy Market Monitoring 2021-22 - 6 October 2022

We have released our draft findings on the electricity and gas retail markets for 2021-22. See our media release and Information paper on the gas retail market.

Electricity prices rose in 2021-22 and will likely rise again in 2022-23

In the year to June 2022, retail electricity market offer prices rose by 2% to 8% for residential and 2% to 6% for small business customers. From June to August 2022 prices continued to rise by 19% to 24% for residential and 31% to 34% for small business customers.

Retail price increases are driven by significantly higher wholesale electricity costs. These higher wholesale costs have been driven by coal-fired generation outages and the war in Ukraine, leading to global gas shortages and higher global gas prices, and fuel supply issues.

NSW customers can still save by shopping around

Rising energy prices coupled with rising inflation and cost of living pressures make it important to shop around for a better energy deal. However, the difference between standing offers and market offers is now much smaller than in the past. Market offers were around 15% below standing offers in May 2022 but reduced to less than 2% in August 2022. However, many customers might still be paying more than they need to. For example, if the discounts on your current plan have expired, or if your prices have recently risen, there may still be a better deal in the market.

There are fewer electricity retailers in the market

For the first time since IPART started monitoring electricity markets in 2013-14, there were fewer retailers in the market than the previous year. The number of retailers with active offers have fallen from 40 to 35 in 2021-22, and then to 27 in August 2022. Some retailers also encouraged their customers to leave during the year, or stopped taking new customers.

Gas prices offered to most small customers have increased significantly

Most small customers in NSW (about 96%) are located in Jemena’s network. The median market price offered in this region increased by about 6% for residential customers and decreased by around 2% for small businesses over 2021-22. However, more substantial price increases followed between June and August 2022 -  around 15% for residential customers and around 26% for small business. Most regional gas networks also saw smaller price increases in the year to June 2022 and then more substantial price rises from June to August 2022.