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A large-scale interconnector project linking the South Australian electricity grid to New South Wales could bring some power price relief once completed.
Key points:
- Rising electricity prices have forced some consumers to invest in a second solar system
- The new SA-NSW interconnector promises to bring down the price of electricity
- It is expected that the savings will take time to be passed on to end consumers
It is welcome news for Shane Weger, who has seen a sharp rise in his power bills over the past two years.
"We were running one solar system up until the middle of last year and the last electricity bill over winter was $1,000," he said.
"One system was running the air-conditioner or the heater, but then prices went up and tariffs went down."
The Riverland father said the increasing power prices meant his family spent $7,000 on a second solar system, as the cost of living continued to rise.
"When you've got kids you put [saving electricity] out the window; they've got to stay warm during the winter time," he said.
Savings will take time
The 900-kilometre high-voltage transmission line will be managed by ElectraNet on the South Australian side of the project and is expected to be constructed and energised by the end of the year.
ElectraNet chief executive Simon Emms said the project could save the average South Australian household nearly $130 a year in electricity bills.
"The savings are a function of the billing cycle and how the retailer contracts its power," he said.
"The benefits are manifested through a reduction in the wholesale energy price, so how that's passed through is up to the retailer."
Mark Yates, managing director of YES Group, a regional South Australian electrical service company, said the infrastructure would help reduce power prices once done, but it could take six months or more.
"Once we start to see this better interconnectivity between the states, ultimately that will drive down the cost of energy," he said.
"With the cost of energy going down, it will then be up to the Australian Energy Market Operator to publish the revised default market offer.
"There's generally about a six-month delay from when we start to see cheaper wholesale prices to when they're passed onto the end consumer."
He said the energy market was dictated by many mechanisms and retailers were not the only ones responsible for increases in power prices.
"The network that's relative to each state is also increasing its prices," he said.
"I would recommend consumers contact their retailers ... and ask for an upgrade to a smart power meter because it will open up the ability to access tariffs you can't access with a basic meter."
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