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The grid regulator acknowledged the time it takes for a solar system and a battery system to pay itself back in savings would be longer. (Source: Getty\/supplied) <\/p>\n The grid regulator acknowledged the time it takes for a solar system and a battery system to pay itself back in savings would be longer. (Source: Getty\/supplied) <\/p>\n
A controversial proposal to shake-up the way households are charged for power would leave howeowners who embraced the government’s battery scheme<\/a> ultimately paying more. The change has been put forth by the agency that oversees the national grid.<\/p>\n It proposes to introduce a much higher fixed charge for residents to access the electricity network, regardless of how much they draw from it. Critics say it could threaten the ongoing rollout of home batteries<\/a> and leave those households paying an extra $3,000 over a decade.<\/p>\n It would ultimately hurt the nearly half a million households with batteries and the millions more with solar, it could deliver as much as $6 billion in overall system savings over 15 years, modelling released on Thursday by the Australian Energy Market Commission (AEMC) shows.<\/p>\n That would provide average bill savings of between $40 and $80 per household by 2040.<\/p>\n RELATED<\/p>\n While it doesn’t appear as a line item on your bill, nearly half your electricity bill is made up of charges to energy companies for maintaining the poles and wires network. But as more solar and battery systems enter the market and more people rely on independent energy sources, energy companies will find it harder to recoup the cost of network maintenance.<\/p>\n The current system of paying for that upkeep via variable charges based on usage is becoming untenable.<\/p>\n As part of the overhaul, the AEMC is recommending a higher fixed network charge that would “more equitably” share the cost across all households.<\/p>\n “Australia’s energy system has changed dramatically over the past decade. Consumers are now generators, sending power back to the grid from solar panels and batteries, and the way we charge for the network needs to keep pace with that change,” AEMC Chair Anna Collyer said.<\/p>\n The modelled transition would begin in 2030 and extends over ten years.<\/p>\n However a potential hike in power bill tariffs has proved controversial and the regulator has been flooded with submissions from solar advocates and homeowners who have already installed a battery system who are critical of the plan.<\/p>\n The regulator said a majority of households \u2013 around two-thirds who are currently unable to have solar or batteries \u2013 would be better off under its proposed changes. Some families could even save up to $740 a year on their electricity bills annually by 2040, it said.<\/p>\n Story continues <\/p>\n As more homes shift away from gas<\/a>, the more a household electrifies, the more it would ultimately benefit under the proposed change of a higher fixed connection cost and lower variable rates.<\/p>\n The AEMC gave an example of one household \u2013 a Melbourne couple who switched off gas entirely, replacing their heater, hot water system, cooktop and oven with electric alternatives. Because that means they would be relying on the electricity grid for all their household energy needs, the lower variable rates would more than offset any rise in fixed charges, it said. As a result, their bills in 2040 would be as much as $600 lower than it would be without the proposed reforms.<\/p>\n “This is the most empirically grounded analysis of network tariff reform we have published. It draws on over 400 million real data points from households across ten distribution networks – not assumptions, but actual consumption patterns from actual customers over a full year,” Collyer said.<\/p>\n However a big caveat of the AEMC modelling is that it’s predicated on an assumption that energy retailers would directly pass network costs onto consumers and the agency said certain consumer protections would likely need to accompany the changes.<\/p>\n The grid regulator acknowledged the time it takes for a solar system and a battery system to pay itself back in savings to the homeowner would increase marginally.<\/p>\n It noted an example of an average battery owner who, under a higher fixed tariff cost, would miss out on about $3,300 in savings over 10 years, compared to the current settings.<\/p>\n “Getting network pricing right creates the foundation for a smarter energy market, one where retailers can offer simpler, more innovative products, consumers are rewarded for the choices they make, and the benefits of the energy transition flow to every Australian, not just those who can afford to invest in it,” Collyer said.<\/p>\n A final report on any changes, as part of the ongoing review<\/a>, will be published in June 2026.<\/p>\n Energy Minister Chris Bowen said his government “has been clear to the industry and regulators”, saying the reforms should “deliver cheaper bills, better reliability and the modern grid and services we all deserve”.<\/p>\n Get the latest Yahoo Finance news – follow us on Facebook<\/a>, LinkedIn<\/a> and Instagram<\/a>.<\/p>\n The regulator is projecting average bill savings of between $40 and $80 per household by 2040. (Source: Getty) <\/p>\n