Electricity Prices Fall Across Australia As Renewables Build Momentum

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As bulk power costs reduce in Australia’s eastern states due to high renewable energy inputs, the price reductions are finally reaching the household and small business consumer. As well as grid-scale wind and solar, we have the highest penetration of rooftop solar, and now home batteries are being added to that at a record rate. The downwards pressure on prices is welcome by everyone but the still persistent naysayers. Are they blind and deaf as well as stupid? 

As the Australian Broadcasting Commission points out, “Occasionally, the conflict becomes so entrenched, and the protagonists so wedded to their positions, that logic is thrown out the window, particularly when the clash involves money.” 

On behalf of my CleanTechnica readers, I have been following this debate for years.

Australian home owners are becoming gentailers — producing and consuming their own power. Over 400,000 small-scale storage systems have been added on Australian homes. These home batteries are not just having a stabilising influence on the grid — reducing the amount of solar power flooding the system in the middle of the day and forcing coal generators to sell at a loss — but are also providing an income stream for the battery owner who is able to sell excess power into the system at night from their batteries when prices are higher. No longer is gas determining the price of power — it is now renewables firmed by batteries.

From July 1st — yes, next month — the Australian Energy Regulator is predicting a fall of at least 10% in costs for households and small businesses on “benchmark plans.” As a safety net, the AER sets a Default Market Offer. This offer is set to decrease across all of Australia’s eastern states (where the bulk of the Australian population live). In practical terms, that means a drop of 7.2% to 10.7% in South East Queensland, where I sit writing this. South East Qld electricity users can expect to save about AU$155 per year. Households in New South Wales will save up to $137 per year from a drop in the rates of about 3.4% to 7.7%. South Australian decreases will sit at 1.4%, and Victoria 5%.

Small businesses, currently suffering from increasing energy costs due to the US war on Iran and its attendant inflation, are getting even more of a reduction. Businesses in New South Wales should be able to save up to AU$1303 per annum. There will be even more reductions in regional areas of almost 21%. South Australian businesses can save up to $673 and Queensland $601. Victorian businesses will save about 6% or $241.

Western Australia is separate from the Eastern grid, but is pushing ahead with renewables and reaping the benefits. Below is a great video from ABC news. Isn’t it great to see those smoke stacks tumble down as coal-fired power plants are replaced by massive batteries.

I need to add that power prices went up over 20% last year and government rebates have ceased. So, while this price reduction is welcome, I would urge property owners to strive for energy independence.

From The Guardian: AER chair Clare Savage said the large entry of batteries into the grid, along with solar and increased output from wind, had reduced volatility, despite uncertainty created by conflict in the Middle East. “Batteries have been displacing more expensive gas and hydro in the evenings, and we’ve just seen flatter prices through the whole day. That’s really translated to lower forward electricity contract prices.” Remember the duck curve? It is getting smoothed out.

Of course, the smart money is on rooftop solar and a battery for those who have the roof space. I would love to have more solar on my roof, but it is full! Add to this the government’s offer of three free hours of power in the middle of the day:

“The new solar sharer offer is an opportunity to make further savings if households can shift some of their electricity usage, such as washing machines, air conditioning, or electric vehicle charging, into the middle of the day,” Savage said.

“We encourage consumers to speak to their retailer about how this new option works because for some households it could be a transformative way to reduce their electricity bills.”

The Australian consumer has a pathway to heavily reduced power bills. There is a way to pay nothing for electricity, gas, or petrol!

Further good news is that gas usage hit its lowest average share for a quarter in the first quarter of 2026. That’s the lowest since 1999. Clean energy generation accounted for 46% of electricity supply in quarter one. Utility-scale and home batteries are soaking up the sunshine in the middle of the day and dispatching it in evening peaks. Gas peaking plants are being displaced accordingly, grid demand is lowered, and wholesale costs are coming down.

Federal Energy Minister Chris Bowen adds: “We know energy bills are still too high — because when coal breaks down, your bill goes up — but this news shows steady progress.” Don’t get too excited, because the trolls are keen to burst your bubble. My expectation is that soon it will be too late to do a Trump and try reverse the progress. Banging on about the value of fossil fuels and nuclear will not win the next election for the conservative parties.

I am looking forward to portable solar that can be used by renters and apartment dwellers. Balcony solar is a good start, but hasn’t really taken off in Australia, yet. Once again, Australia’s energy future looks bright and renewable, with energy independence a possibility for many.