Australia facing UK-style energy crisis

price graph with lightbulb (AER)
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Australia is on the verge of a UK-style energy crisis that could see many power retailers in financial strife and leave everyday Australians unable to pay their bills, a leading expert has told ABC News.

Soaring wholesale energy prices has triggered fears that a significant number of Australian electricity retailers could go broke in the crunch.

Incoming Treasurer Jim Chalmers said Australia was facing a “perfect storm” of challenges in its energy sector.

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Chalmers pointed to news that that gas prices in Victoria had increased more than 50 times than normal levels, prompting an intervention from the energy market regulator.

He said Australia was paying a price for almost a decade of energy policy uncertainty under the Coalition government.

“On energy in particular, this is an incredibly challenging set of circumstances, particularly for Australian industry, when you consider this spike in gas prices, which goes hand-in-hand with a spike in the price of liquid fuels and a spike in the price of electricity as well,” Chalmers said.

“This is, unfortunately, a perfect storm of conditions and challenges in our energy market.”

New Zealand-based electricity retailer ReAmped has made headlines by telling customers to look elsewhere because it was no longer able to supply an affordable service.

CEO Luke Blincoe told the company’s 80,000 customers across Australia’s east coast that ReAmped had taken the extraordinary decision to step back from the market.

He said the company was urging customers to find a new deal quickly, suggesting they had little time to act before retail prices “doubled”.

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“The wholesale energy market has just become so extreme that we’re now seeing a situation where wholesale prices are above retail prices,” Blincoe said.

“So, unless you’re a generator, there is simply not a sustainable position in the retail marketplace.

Read the full article here.

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