Supermarket totters over $218k energy bill

A Queensland supermarket owner has been shaken by an “impossible” electricity price hike that would nearly quadruple his annual bill to $218,000.

A Queensland supermarket owner has been shaken by an “impossible” increase in electricity prices that would nearly quadruple his annual bill from about $58,000 to $218,000.

Lewis “Kelly” Anderson told The courier post he was shocked after AGL informed him of the impending raise for its IGA supermarket in Mapleton on the Sunshine Coast.

Anderson said the staggering increase would mean 80 percent of his business expenses would go toward paying for power.

“We would find it very difficult, if not impossible, to afford that,” he said, adding that the 26-year-old family business had already installed as many solar panels as possible on the roof.

A copy of Mr. Anderson’s electric bill provided to news.com.au shows that the maximum energy rate for his property will increase from 6.5453 to 25.5743 cents per kilowatt hour when his 24-month contract ends Nov. 1. expires. increase of nearly 300 percent.

The off-peak rate goes from 4.4459 to 16.0345 cents per kilowatt hour, an increase of 260 percent.

Anderson told the newspaper that AGL had informed him that the price hike was “out of their control” and that he had blamed the war in Ukraine.

In a statement, an AGL spokesperson said Australians “would have heard about the unprecedented situation affecting the wider energy market and this is no exception”.

“This kind of increase is not unique to AGL Energy, and other retailers will inform their commercial and industrial customers about similar price changes,” he said.

“When commercial and industrial customers with high electricity consumption – such as supermarkets – terminate the contract with their retailer, they are exposed to current market conditions, including much higher wholesale costs and network tariffs, which affect all energy stores and the wider market. This is very different from many smaller companies that do not use this amount of electricity and are on stand or market offers.”

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He added: “While we do not comment on specific customers, we are aware of the additional pressure the unprecedented energy market situation is placing on our commercial and industrial customers and we are actively working closely with them as they exit their contracts. come to help them with their options.”

AGL’s position is that Mr. Anderson signed a two-year contract with AGL in 2020, when wholesale and network energy costs were significantly lower than today.

The power company claims its annual bill will rise from $58,000 a year to about $110,000 a year, or just under double that, not quadruple.

AGL says its company uses a lot of energy – 390 megawatt hours per year – and is therefore classified as a commercial and industrial customer. Smaller business customers consuming less than 100 megawatt hours per year operate on market contracts with prices set by AGL or energy regulators.

Small businesses on regulated permanent supply in Queensland, for example, will see an average increase of 13.4 percent, following the Australian energy regulator’s decision.

Commercial and industrial customers contract with energy retailers on an individual basis, with prices set largely at market rates.

The Queensland Chamber of Commerce and Industry has called on the state government to intervene urgently with a business support package, warning that skyrocketing energy costs were a “critical concern” and were not addressed in this week’s state budget.

“We know that rebates have historically served as an appropriate mechanism to ease pressure on electric bills, especially for small businesses,” CCIQ policy and advocacy manager Cherie Josephson said in a statement.

“For larger businesses, which are likely to feel a greater impact — some are likely to see a 21.2 percent increase in their electric bills — CCIQ would like to see longer-term solutions such as incentives for corporate sustainability and initiatives to help ease pressure on businesses. the energy bill now and in the future.”

Opposition energy spokesman Ted O’Brien has called on Prime Minister Anthony Albanese to take steps to deliver on Labor’s pledge to cut power prices, warning that thousands of small businesses are at risk of collapse.

“Australia risks a series of business closures if the Labor government fails to address the short-term effects of rising power prices,” he said.

“Last month Labor pledged to cut energy bills and Australians expect nothing less than to deliver on this promise. A global energy crisis has hit our shores and it is up to the current government to manage the domestic fallout.”

Mr O’Brien claimed that the coalition was “handling this pressure until a month ago and that we were able to cut average energy bills for small businesses by 10 percent in the past two years alone”.

“Labour came to power and promised further austerity measures, but prices are now going the other way,” he said.

“I am deeply concerned about small businesses across Australia that will soon be plagued by prohibitive increases in their energy bills.”

Federal Energy Secretary Chris Bowen warned this weekend that Australians were facing a “bumpy winter” of rising energy costs, saying there was no “quick fix” to the crisis.

“I’ve said before it’s going to be a bumpy winter,” he told Seven’s sunrise on Sunday.

“The system is not fit for purpose. So we have a short-term plan to keep the lights on and it’s worked so far. Then we have a long-term plan to invest more in the system.”

Blaming “a decade of changing energy policies” and “not enough investment in energy storage and non-renewables,” Bowen said the government should build “10,000 miles of transmission cable through this country.”

“That’s not going to happen this year,” Bowen said.

“We can start and we’ve started and we’re starting, but it’s not going to happen right away. What we can do in the coming years is building, putting pressure on energy prices through renewable energy. I think Australians understand that you can’t solve this in a day and we never claimed we can.”

His comments came as Tennant Reed of the Australian Industry Group warned of impending price hikes for households.

Mr Reed told Nine News that international competition for coal and gas would inevitably keep domestic generation costs high.

“We’re in the frying pan right now, and if we’re lucky, we’ll be in the slow cooker in the coming months,” he said.

“Over the next two years, households will likely pay 50 percent more for their electricity and possibly double that for their gas.”

Meanwhile, the Australian energy market operator will lift his suspension of the National Electricity Market at 2 p.m. on Friday.

The AEMO seized control of the market for the first time in history last week to stabilize power supplies and prevent the threat of power outages.

The chaos was caused by price caps imposed by the AEMO on generators, forcing them to withdraw capacity from the east coast market.

frank.chung@news.com.au

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