The energy monster is about to devour Albo’s cowards

While Albo’s cowards are busy protecting a war-profiteering foreign energy cartel, it has fastened itself to household budgets like a foot-long leech to their flesh:

AGL Energy has slugged its NSW customers with a $300 annual increase in their power bills as the power giant passes on soaring costs in the national electricity market.

The energy retailer, the subject of fresh takeover speculation by former suitor Brookfield, said the new charges for households on variable contracts will kick in from August 1 in NSW, representing a 17.5 per cent increase on the prior year.

AGL’s Queensland customers will cop a $275 or 18 per cent annual jump on average with South Australian bill rising by $155 annually or 8.4 per cent. Victorian households will fare better but can expect an $80 lift in their bills, up 5.6 per cent on the 2021-22 year.

Residential customers also face higher gas bills with Queensland households facing the biggest hike of $81 marking a 10.5 per cent increase, South Australia up $76 or 8.7 per cent and NSW $73 more annually or 8.8 per cent higher.

AGL is only responding to the wholesale electricity price shock driven by coal and gas prices. This is only the beginning. As household and business utility contracts roll off each quarter, the shocking price rises will continue for the next year and more until everybody is paying 100% more.

There is no sign that wholesale power prices are getting better. Since the AEMO resumed auctions in the power market, prices have only gone up:

The cartel itself is serenely manipulating the media:

Gas will play a crucial role for decades as a stabliser for the electricity grid in a cleaner energy future, according to a new 30-year roadmap by the national energy market regulator.

The Australian Petroleum Production & Exploration Association (APPEA) today said the Australian Energy Market Operator (AEMO) had confirmed the long and enduring value of natural gas partnering with renewables with the release of its 2022 Integrated System Plan (ISP).

APPEA Acting Chief Executive Damian Dwyer said the Plan showed the key role of gas as the world decarbonises by citing the mid-2040s as a time when gas would back up electricity largely powered by renewable generation after the retirement of coal-fired power.

The failed regulator has its head up its arse. We need to urgently invest to fix the problem by 2050!

Australia must accelerate a move away from coal to renewables and storage and urgently sanction more than $10bn of transmission projects to escape the ongoing threat of blackouts and high power prices amid a national ­energy crisis.

The Australian Energy Market Operator, which runs the ­national electricity network, said the country was undergoing a “complex, rapid and irreversible” change to its energy system that would need a nine-fold increase in wind and solar capacity by 2050 to meet the nation’s net-zero emissions targets.

Meanwhile, the real crisis, which is gas and coal prices, is actually getting worse as Russia strangles Europe. Deutsche Bank:

We are becoming increasingly concerned about the unfolding energy situation in Germany. Two weeks ago, Russia reduced Nordstream gas flows by 60% on the back of an alleged disruption over Siemens part supplies (chart 1). While the immediate availability of gas in Germany is not an issue, the energy market is starting to price a risk of a complete disruption to gas supplies for winter. Year-ahead natural gas prices are making fresh record highs (chart 2). Most concerning however, is the skyrocketing price of electricity. Prices for 2023 delivery have also soared to all-time highs and have now tripled from the start of the year (chart 3). French and Italian electricity prices are similarly soaring. The share price of Germany’s largest utility gas consumer has dropped to record lows (chart 4).

Our underlying assumption so far this year has been that gas supplies to Europe would continue. The Nordstream pipeline is set to shut for ten days during July 11-21 for regular maintenance and press reporting is suggesting that authorities are attempting to find a solution on sanctions restrictions to move gas turbine components back to Russia. The German government is stating that disruptions are politically motivated and there are risks supply may be completely shut off.

If the gas shutoff is not resolved in coming weeks we worry this will lead to a broadening out of energy disruption with material upfront effects on economic growth, and of course much higher inflation. Beyond the market’s worries about slower global growth in recent months, what is unfolding in Europe in recent days is a fresh big negative supply shock. This will clearly make the ECB’s job more difficult and their reaction function ambivalent. But as far as the EUR/USD exchange rate goes, it would provide clear downside. Not only would the energy import bill rise due to even higher prices, but it would raise the risk of an imminent German recession on the back of energy rationing. Our EUR/USD forecasts imply a range-bound euro over the summer months. We worry that the energy situation is providing clear downside risks.

Do Albo’s cowards really want Australia to be sucked into this European maelstrom of war profiteering inflation, falling house prices and recession? Even though we dig up coal and gas virtually for free down the road?

Albo’s cowards MUST install domestic reservation, an export levy benchmarked to pre-Ukraine prices or super-profits taxes URGENTLY or the RBA will be forced to pointlessly crash the economy in the NEXT FEW MONTHS.

I can think of no better way to get tossed out of power ASAP.

Houses and Holes
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Comments

  1. 1) Get yourself into the Labor party
    2) Convince the dumb voters you will give them $100 more than Liberal
    3) Get 30-45% of the vote and gain power.

    No mention of doing anything sensible about energy.

    Next election, repeat steps 1-3

    • The Travelling PhantomMEMBER

      In Victoria they are literally giving $250 to every household

        • His friends call him Eser and he’s the main geezer
          And he’ll vibe up the place like no other man could
          Though very much maligned and misunderstood
          But he won’t pull the trigger to save your hood
          Cos The cartel have him weaker
          he’s just trippin by the base speaker

          he’s Alboneser Goode …

  2. pfh007.comMEMBER

    “..I can think of no better way to get tossed out of power ASAP…”

    Yes – the ALP are absolutely crazy to be forcing Australian households to pay “world prices” for energy that we produce for peanuts and often sell offshore for low prices..

    One would have thought that after almost 10 years in the political wilderness that the ALP might have learnt that appealing to a mangy bunch of comporate donors and lobbyists means nothing if the Australian public hates your guts.

    Albo needs to wake up before he delivers Australia to Dutton.

    • happy valleyMEMBER

      Dutton should ask for access to The Lodge and Kirribilli House to see what renos need doing before he moves in 2025 – that’s baked in.

  3. 2023HomelessMEMBER

    So is MB ready to concede the market pricing for the cash rate is now more likely to be close? Seems we have the following inflation drivers baked in:
    1. Fuel tax increase in September, plus sanctions starting to bite in the next half.
    2. Electricity increases baked in, and more to come.
    3. Gas increases baked in, and more to come.
    4. Minimum wage increase locked in, and state ‘cost of living’ handouts on the way
    5. Industrial action in the public sector locked in. Setting an expectation for broader pay rise requests.
    6. The immigration tap no longer working.
    7. Dollar likely to fall as Australia is increasingly behind the Fed.

    That’s a long list of baked in inflation drivers over the next year.

    Maybe the market pricing isn’t that far off?

      • Dave666MEMBER

        On the point of Immigration Tap……Whats going on? Any chance of an update in this area?

    • The Travelling PhantomMEMBER

      Indeed, for example Victoria giving $250 to assist households to pay their power bills

    • Jumping jack flash

      “Minimum wage increase locked in, and state ‘cost of living’ handouts on the way”

      That was a hangover from their last economic policy. The agenda has recently changed. At least it certainly looks that way.

      Don’t be surprised if they eventually reverse it “in the name of [global] inflation”, but taking something away is never easy especially when interest rates are rising and debt growth is falling.

      Note that Australia wasn’t the only country to do this. Pretty much all developed countries have also recently done it, or recently started the political processes for kicking off wage inflation.

      • Cost of living handouts would be working directly against the RBA. More dumb policy with different parts of government failing to have a cohesive strategy. Let alone a policy that isn’t as dumb as to crash the whole economy, in an attempt to take the edge off supply side inflation! Some countries have had high inflation for years without it going hyper which is what they are scared of, and there would be no chance of even high inflation if Albo used the tool no (?) other country has, gas reservation!

  4. No No, good old Albo has already set the stage, his little speech the other day made it clear that “Australia cannot escape international energy pressures as Australian’s will need to share the pain of Europe” Or something very similar to that effect.

    Oh but hey, we had a chat with Macron so all is good! I’m surprised a hug and kiss photo opp with the princess of progressives across the ditch hasn’t been placed further up the urgent national agenda.

    • Albo giving the horse a pash whilst she has her head covering on, that would be something….

    • Jumping jack flash

      Mate, get with the programme. It’s all worth it to Make Putin Pay(tm)

    • Yeah, Albo has the gas reservation weapon no other country has (?) + windfall tax etc Labor are stupid not to use them but instead crush the economy with no guarantee inflation will fall enough, we could end up with a crushed economy, low productivity, high unemployment & inflation still above RBA’s desired band, would that really be better than higher inflation in a hot economy?

  5. seanraceMEMBER

    “ I can think of no better way to get tossed out of power ASAP.”

    Incorrect. Voters cannot do this. Only vested interests can change a PM like that.

  6. “The failed regulator has its head up its arse.”
    They know where to find cheap gas 😂

  7. MathiasMEMBER

    Bye Bye Domestic Economy.

    Anti-Corruption Commission Urgently… or… Australias done.

  8. West is best…. my household gas bill is 30c/ day….

    Domgas reservation is great! Gillard ought to be hung for her actions approving Curtis Island export plants sans reservation. #RoyalCommission!

  9. Yeah 18% went up in Sydney with Origin

    But if you can’t handle that then seriously stop using Afterpay

  10. Ailart SuaMEMBER

    Pretty sure a global economic crash was planned some time back. Just as the pandemic was. Modern neoliberalism has been on life-support since 2008: just waiting for the tubes to be yanked out. I don’t know if the establishment has any detailed, globally agreed upon plans for the next economic model, but I’m pretty sure whatever it turns out to be, authoritarian control will play a major role.

    BTW, as I’ve been saying for decades – it doesn’t matter a steaming turd which of the only two governments we’re allowed to have is in office, they do what the establishment tells them to do – as do the RBA puppets. Democracy was buried yonks ago.

    The only weapon citizens have against this tyranny, is solidarity and a 4-pronged gardening tool located at Bunnings. You know what I mean…

    • Jumping jack flash

      THIS!
      Albo’s recent comments about China are pretty much proof.
      Going into the election he was all like “we need to make China our friends”.
      And as soon as he’s rubbing shoulders with the global elite he’s like “oh, yes, I see your agenda now, yes, China must be crushed!”

      “The only weapon citizens have against this tyranny, is solidarity and a 4-pronged gardening tool located at Bunnings. You know what I mean…”

      Yes, that 4-pronged thingy that they make in China and import, and then sell at Bunnings plus markup, and then we use our credit cards to buy it.. or 4 easy payments with afterpay… yes, I know exactly what you mean.

      • Recycling one out of backyard junk bypasses their plans there, & it’ll last longer than a one off gardening too…..

    • I’ve been mulling that concept as well over the last few months. Nothing is ever not planned, unless the puppet masters are completely dumb…and I don’t think they are. There is method in any madness, but I haven’t been able to figure it out apart from the system needing to feed on itself to perpetuate it’s existence. I rather think of the GFC and Covid as events that arose that were taken advantage of for the benefit of the 1%’ers…..They find it galling if the end result of QE would be the 1%’ers becoming the 10%’ers. Feudalism at it’s finest!!

      • Jumping jack flash

        “apart from the system needing to feed on itself to perpetuate it’s existence”

        Behold the glorious infinite debt economy. Aka, neo-Keynesianism – the bankers’ utopia.

        Its the system you get when you put the banks in charge of the economy and let them run with it unchecked.
        However I still don’t know why they would purposely want to collapse it now. It really looked like they were going down the hyperinflation path until just recently. Hyperinflation sounds scary, but its like falling into a black hole: if everything and everyone around you also falls at the same time, you just don’t notice anything happening at all.

      • 2023HomelessMEMBER

        If you think governments plan like you suggest. You have clearly never worked in central government. It’s a shambles. There is no agreed plan on the worlds economic path. Just reactionary responses and some scenario analysis. It’s actually scary. So yes, dumb they are.

        • Agree, I’m firmly in the completely unplanned camp of government errors & miscalculations by governments the world over.

  11. Jumping jack flash

    My electricity bill has pretty much halved since I turned on my solar panels, and its only winter.
    Just in time for electricity prices to double…. doh!

    • YEah I need to look into this, do you know what the payback is on panels? 5 years?

      • Jumping jack flash

        I haven’t really done the calculations, but quick back of the envelope, if this latest bill is anything to go by it looks like I’m probably saving about $300 – 400 each bill (probably more in summer), 4 bills a year, so, about 5 years, probably.

          • 2023HomelessMEMBER

            Payback is now 2 years on solar. You can even get finance to cover all out of pockets and repayments monthly that are less than the bill savings. Finance is organised by the solar companies.

        • Solar Feed-in-Tariff is just another form of middle class welfare.
          there’s nothing amazing about it, it’s really kind of stupid. We’ve created a system where middle class home owners get their electricity subsidized by the poorest Aussie renters.
          It disgusts me.
          By all means put up Solar BUT include Storage and don’t just expect the grid to absorb electricity that it really doesn’t need.

  12. So why is Labor so glib on this? Is it really Club Neo-acolytis?

    Or this – In the absence of being able to print oil and gas, refinery capacity, very large crude carriers (VLCCs), fertilizers, grains, rare earth metals for EVs etc…Central Banks are really left with no choice but to drive economies into recession in order to curtail “demand” -pressure on prices, even though they’re a much smaller attributing factor to inflation. https://www.zerohedge.com/markets/market-starting-down-abyss-contraction

    • Arthur Schopenhauer

      It’s a club of Lawyers. All words, no action.

      Chinese Government is full of Engineers.

      QED.

  13. Peter SMEMBER

    Making a profit and profiteering are quite different things I reckon. One is happenstance and the other is organised and promoted.

  14. I am not so sure, I feel like they might do SOMETHING but only after it is an actual crisis, ACCC says so and people are angry enough with coal and gas companies. Let’s face it, what can’t be paid won’t be paid. Isn’t the answer to the climate emergency letting these energy companies price themselves out of the market?
    Why would I throw labour out for that? Let people claim hardship on every bill and have the energy companies be hated like Qantas for a while…

    • Lets hope they are waiting for the groundswell of negative opinion on energy but I have doubts it’ll happen fast enough for suitable action to be taken.

  15. Is there a chance that they want something like this to happen? Like they know that the property situation needs correcting, among other things, the cartel, super rorts, etc and they want something to blame it on?

    TBH its a pretty convenient excuse.

  16. LOL. The EU and the fools that run it are strangling themselves. Russia doesn’t need to do anything.

  17. Let the prices of fossil fuels rip to turn the screws on businesses and households still reliant on fossil fuels. The faster we move over to an economy based on renewables the stronger our economy will be in the long run. The only thing that will accelerate our move to renewables is a fire lit under those still using fossil fuels.

    Export the fossil fuels cheaply to other countries and let them prop up their businesses and household with fossil fuels while we gain the competitive advantage by becoming a renewable energy powerhouse.

    This is even better than a carbon tax and/or emissions trading schemes. Let the market flush out the idiots who haven’t adapted fast enough to renewables.

  18. PlanetraderMEMBER

    Pray tell which renewables do you think are going to actually replace fossil fuels Smiley?

    • Necessity is the mother of invention. As long as fossil fuel prices are more expensive in Australia relative to other countries the faster we are going to adapt renewables relative to other countries and the more competitive we will be in the long run. High fossil fuel prices are good for our kids.

  19. PlanetraderMEMBER

    Rubbish – you cant answer the question because you know the unreliables don’t work

    you will impoverish a nation with that stupidity

    • Nonesense. South Australia is forecast to be 85% renewables in 2025-26 (up from 60%) today and 1% 15 years ago. They don’t have any substantial renewable advantages over the other states and they certainly haven’t gone bankrupt.

      I can point to many other examples, but I’m probably talking to a brick wall. Sure it’s expensive to move to renewables but probably better to take the pain now, while we are rich, than later when we can’t afford it because we have become a banana republic. Cheap fossil fuels are an opiate for the masses.