The gas cartel will wreck your standard of living if left unaddressed:
Economists warn that persistent and higher than expected power price rises in coming years will need to be offset by lower price rises in other areas of the economy to enable the Reserve Bank to keep inflation in the target band.
Expectations have grown that the stumbling transition to low-carbon energy will help drive years of elevated or volatile wholesale power prices as the build-out of clean energy generation lags what is needed to replace ageing coal power stations.
Higher prices for gas have also played a part in driving up forward prices for electricity across the major regions of the grid in recent weeks.
Economists broadly agree that if electricity prices are shifting higher in Australia, that would add to inflation pressures, requiring price increases to be lower in other parts of the economy to achieve targeted inflation rates.
As things stand, fiscal subsidies are compensating for the price increases seen in recent utility bills.
But, outside of QLD, which hiked coal royalties to pay for the subsidies, the rebates are paid for by higher taxes.
That’s the first higher price households will face.
The second is higher interest rates, which will hurt house prices and housing construction via inflated prices of energy-intensive building materials, meaning renters will also be smashed for as long as the gas cartel reigns.
One way or another, nearly all Australians will be made poorer to ‘make room’ for a gas cartel that need not exist and can be easily broken if somebody in Canberra grows the cojonies.
