Knowledge is power

By Shaun Inguanzo
BUSINESSES renewing electricity contracts have been warned to enter negotiations armed with information to avoid being hit by enormous price hikes.
The warning from the Energy Users Association of Australia (EUAA) comes after claims that some businesses have seen price increases of up to 50 per cent in their energy bills under new contracts with energy retailers.
The price hike is the domino effect of a 73 per cent increase in electricity generation prices.
EUAA chief executive Roman Domanski said businesses could expect a “price shock” when renewing contracts because energy retailers would pass on the increased costs to customers.
“We are definitely seeing prices starting to impact our members,” Mr Domanski said.
“We are seeing levels in prices on the table which are significantly higher than a year ago.
“And when I say significant, I’m talking about 40 to 50 per cent more, and it is likely that (electricity) will go even higher than that.”
Mr Domanski said the fact that retailers were constantly changing offers indicated the instability in the energy market.
He warned businesses not to grab a contract because an offer might quickly expire.
“Businesses need to be careful about negotiating contracts,” he said. “A lot of it depends on timing, and the business needs to be well informed about energy.”
Mr Domanski said the EUAA was beginning its research into the energy price boom, but early signs indicated a lack of hydroelectricity due to dry dams, anticipation by generators of a carbon tax, and even speculation of a lack of competition in the energy industry had contributed to the rise.