Price gap between metro and regional energy bills drives push from NSW councils for 'fairer' prices

The high price of electricity in regional areas has come under the spotlight, with local councils set to lobby the NSW government for a "fairer deal". 

The minimum daily electricity tariff in metro NSW can be as low as $0.79 but in regional and rural NSW, the lowest daily charge is $1.57 – almost double the amount.  

Mayor of Narrandera Shire Council in south-western NSW, Neville Kschenka, said it was not good enough.  

"It's just not fair,  and it's been brought to our attention by our own ratepayers and other councils," he said. 

"We want fair pricing between the two regions."  

In NSW, electricity retailers set their own prices and take into account the costs to generate electricity, distribute it through the networks, any environmental costs as well as their own retail costs and margins. 

While retailers set their own prices, the cost of their supply charges for a household helps to cover the price of network costs.  

The supply charge is a daily fee to be connected to the network.

The networks provide the infrastructure for the transmission lines and there are three main networks that service NSW.  

Ausgrid and Endeavour Energy provide electricity across the Sydney, Central Coast, Hunter Region, Newcastle, Blue Mountains, Southern Highlands and Illawarra areas. 

Essential Energy covers rural and regional NSW as well as a few coastal areas, comprising 95 per cent of the state's land.

Essential Energy is owned by the state government and regulated by the Australian Energy Regulator (AER), which means most of its distribution services are subject to revenue and price controls determined by the AER.  

In a statement, a spokesperson for the AER says higher costs on the Essential Energy network are due to customers using more energy, the fact it is a larger distribution zone with fewer people, and the network costs (poles and wires) per customer being higher.  

But at a recent NSW local government conference, a motion to advocate for cheaper prices in the regions was passed. 

Taking the push to parliament  

The Local Government NSW (LGNSW) body will advocate to the state government for Essential Energy to align rural supply charges with those applied to city and coastal consumers.  

The Minister for Energy Penny Sharpe did not comment on the motion but said she was open to receiving correspondence from local councils.  

Meanwhile, high energy prices are taking a toll on the region's most vulnerable. 

Griffith's Linking Communities Network assists people in emergency situations to apply for a state government program for those going through financial hardship or a crisis such as loss of income, natural disasters or family violence.

It can cover up to $400 at a time but can only be applied twice a year.  

"A young person who has to rent a property at perhaps $400 or $500 a week and then having their electricity on top of that plus their living allowances, their food and it just becomes unattainable for people to have rentals by themselves," CEO of Linking Communities Network Kirrilly Salvestro said.

"It's a dire situation, particularly for single parents, young people, those that are struggling to meet the needs of everyday life."

It was an issue, she said, they had seen progressively get worse.  

"Even though the government has established a one-off payment for people, the electricity seems to be rising at a greater price than what the government is giving to households," she said. 

It follows the federal government's announcement that the electricity bill subsidy would not be extended into next year. 

The motion from the Local Government NSW conference is set to be discussed in the body's first board meeting today when it will establish policy positions from the conference and from there will begin raising the issue with Ms Sharpe.