The state’ economic watchdog has released its final report on its inquiry into electricity retailer Synergy, saying the utility would have to hike residential bills by 29 per cent on average to ensure taxpayers are not covering the gap between costs of supply and revenue.
The amount includes an estimated 8.6 per cent electricity price increase brought on by the federal government’s new carbon pricing regime, while 2.5 per cent of the cost hike can be attributed to inflation.
Across all energy customers, the Economic Regulation Authority recommended a price hike of 21 per cent.
The ERA recommended in April a 23 per cent increase in residential bills to cover costs, and a 15.8 per cent increase across the board.
The ERA, however, said the government’s current scheme of subsidising Horizon Power customers in the north of the state through a levy on electricity customers in the south west of WA would add another 7.1 per cent to the average residential tariff.
The authority said its next inquiry into Synergy’s efficiency would be conducted in 2014/15, to allow for a timely assessment of changes in carbon costs.