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Will the carbon tax impact electrcity prices?

The debate around the carbon tax continues to rage on, especially after Julia Gillard announced the scheme’s finer details on Sunday. No matter what your political allegiance may be, there’s no doubt that a further increase in electricity pricing is a cause for concern.

Victorian governments are already speculating that their public hospitals would face a $13.6 million increase in annual electricity bills. It also claims that the cost of running public transport will increase by $14.1 million a year and estimates a Melbourne household with an electric hot water system will face an increase of $204 a year in electricity bills.  I must point out, however, that these speculative prices don’t take into account the promised compensation – the modelling of how this will be rolled out is yet to be revealed.

This is all on top of the regulator price hikes we’ve seen from the start of July.

Although there’s definitely merit in the immediate need drive some positive action on climate change, I fear this will be a crippling blow for small and medium businesses Australia-wide.

With the double whammy of GFC and seasonal retail dips, this price hike could be the final nail for many of us.

So what’s the plan?  The retailers will definitely be on the front-foot – promoting all kinds of offers to encourage you to jump ship as the panic about the carbon tax sets in.  But don’t feel pressured to move. This is the time to be cautious if you decide to go to the market and shop around for a better deal on your electricity.  As I’ve mentioned before, think hard before you jump to a new provider. Work through what you want – cashback, a flexible contract or a longer term lower price option.  If you need advice, go to an expert.  A 10-minute phone call could end up saving you thousands of dollars. Remember that you are in the driving seat and you can tailor a contract that fits your specific needs.

Although the outlook may look bleak, there is some light at the end of the tunnel.  Those electricity retailers want your business, and now, more than ever, they are prepared to work even harder to get it, so check out your options and plan ahead to make sure you aren’t one of the businesses that suffers when Sunday’s announcement hits the headlines next week.

What do you think?

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Tim Wolfenden

Tim Wolfenden

Tim Wolfenden is the CEO of Make It Cheaper, an independent energy broker providing electricity price comparison services to businesses and residences. He specialises in developing successful e-commerce strategy, commercial negotiations, online product development, strategic planning, business analytics, SEO and SEM management and tweets as @aussieonline.

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