Why are energy prices rising in Australia? Australia’s energy crisis explained. Why now is the best time to get Solar for your home or business

Australia’s energy crisis explained

Learn more about the energy crisis in Australia and how you can best protect yourself and your business(es) from linked losses of any kind

Winter is coming. And if you’re anything like the good ol’ fighting folks of Winterfell, you’re gearing up for the battle with hikes in energy prices.

Back in May, the Australian Energy Regulator (AER) informed customers that there’d be a significant hike in power bills from the 1st of July 2022 in New South Wales, Queensland, South Australia, Victoria, and Western Australia.

The Energy Regulator also updated its default market offer – the limit on the amount customers can be charged by power suppliers. Customers in New South Wales could see electricity prices go up by 18%, parts of Queensland by 12%, and South Australia by almost 20%.

The Essential Services Commission (ESC) in Victoria also announced a price increase to the Victorian Default Offer (VDO) of up to 5% for residential and small business customers from the 1st of July 2022.

Why Does Australia Have An Energy Crisis?

The AER based this increase in energy prices on reasons such as the current war in Ukraine, which has disrupted the global energy market, coal and gas power plant shutdowns for maintenance purposes, the flooding events in New South Wales and Queensland that have affected coal supply, and an increase in gas and coal prices worldwide which caused a spike in wholesale electricity prices.

Owing largely to these factors, people and businesses have to inevitably face the bummer that’s energy prices going through the roof during the cold time period of the year.

But what does this mean for the average Aussie whose instinct’s pushing for that heater dial when the cold arrives? What’s the signal here? Many recommendations on how customers can survive the energy crisis have been made by energy experts, energy retailers, and the powers-that-be. By and large, it’s high time households, and businesses took a different course of action for power supply – solar energy.

Given the repeated unplanned shutdowns of coal and gas power plants, it has become necessary for extended use of renewable energy in the energy mix to take place.

Renewable energy resources provide us with cheap, affordable, and consistent electricity. The wind, sun, and waves are all renewable energy sources in Australia. However, the most used of these sources by residential customers is solar energy (energy from the sun).

What is Solar Energy?

Put in its simplest form, Solar energy is sunlight. When energy from sunlight is converted to electricity, it’s called Solar power. Australia has the highest solar radiation per square metre of any continent and is, as a result, some of the best solar energy resource in the world.

There’re two types of solar energy technology:

1. Solar thermal and
2. Solar photovoltaic (PV).

Solar thermal, on the one hand, converts solar energy or radiation into thermal energy (heat) used for large-scale electricity generation.

Solar PV, on the other hand, converts sunlight into electricity using PV cells. The most common form of Solar PV cell is typically encased in glass and an aluminum frame to form a solar panel installed on a non-shady rooftop spot so it can capture the sun’s energy.

This energy is captured as direct current (DC) and then converted through an inverter to alternating current (AC), so you can use it.

Benefits of Solar power

Using solar power reduces your bill from electricity retailers. When you use solar panels to generate your electricity, you may have little need for electricity from the grid, reducing your electricity bill by a high margin.

Solar panels also do not require any special maintenance besides routine cleaning and health checks. This technology is pretty much plug-and-play, so you don’t have to worry about maintenance costs. You’d be getting the best value for low long-term costs. Pretty sweet.

You’re probably wondering: “If solar power derives from sunlight, how would I then still have access to power at night or on cloudy days?” Well, Solar batteries is your fix.

With Solar batteries, you can save excess energy captured by your solar panel from the sun to serve you on rainy days.

You also enjoy the benefit of feed-in tariffs when using solar energy. States like South Australia, Queensland, and Victoria allow households with installed solar panels to sell excess electricity to electricity retailers who transmit it (feed-in) into the electricity grid.

That sale of excess electricity to electricity retailers reduces your electricity bill from those retailers for the electricity they must have supplied to your residence if you are still connected to them. If not, you can consider the feed-in tariff you get as your coins in a bowl.

Why now is the best time to get Solar power

According to energy experts, households with solar panels and feed-in tariffs are likely to see an increase in their feed-in tariffs to match the hike in wholesale electricity prices. When this happens, those households will be protected from any coming electricity price changes when this happens.

Solar power will also be more than instrumental in reducing your electricity bill in the wake of the price apocalypse; and with the current rise in the costs of other amenities countrywide, wouldn’t this be the best time for households and businesses to make that long-term investment that can fetch some extra bucks regularly?

Efficient Energy Group is helping thousands of homes and businesses harness energy-efficient solar solutions. Need help with this process? Our team’s ready when you are are. Hit us up for bookings or a no-obligation consultation.