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Why are energy prices going up in Australia?
Why are energy prices going up in Australia?
Written by
Rachel Gregg
Edited by
Ellie Garran
Reviewed by
Julia PaszkaCompare Electricity & Gas Plans
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Are energy prices increasing in Australia?
Long story short
Energy prices have risen due to higher production and supply costs
Since 2020, wholesale electricity and gas prices, along with network and infrastructure costs, have made energy more expensive to produce and supply.
Global events and ageing infrastructure play a big role
International gas markets, geopolitical disruptions and older coal power stations have driven volatility and pushed wholesale prices higher.
Households still have ways to soften the impact
Even when prices rise, comparing plans, tracking usage, upgrading appliances and considering solar can help keep power bills under control.
Are energy prices increasing in Australia?
Many Australian homes have seen their energy bills rise significantly since 2020. This is mainly due to higher wholesale electricity and gas costs, increased network costs and infrastructure needs, and a mix of other factors that mean energy costs more to produce now than it did a few years ago.
Understanding what’s behind these rising energy costs and the state of Australia’s energy crisis can help explain why your electricity bill is creeping higher and where you might be able to claw some savings back and get some much-needed relief during this cost of living crisis.
What’s causing energy prices to increase in Australia?
Energy prices are increasing across Australia due to a combination of domestic supply and global factors, which are all impacting and driving up the cost of generating and supplying energy. Key influences include higher wholesale prices driven by international energy markets and the impact that global events have on energy supplies, plus local issues like extreme weather conditions and Australia’s ageing coal power stations, which impact our generation levels and increase costs during high demand periods.
International market
Australia exports a large portion (over 80%) of its gas overseas, which commands higher market prices. This means that, to buy gas, Australia needs to keep up with international prices. The higher gas purchase prices are reflected on your bills. And because gas is also used to generate some of our electricity, this means higher electricity prices, too.
Global impacts
Being part of the global energy market means Australia is more prone to disruptions and global events that affect supply lines. This is why energy prices skyrocketed in 2022 from the war between Russia and Ukraine, and why we’re experiencing impacts from the conflict in the Middle East.
Higher wholesale energy prices
Wholesale electricity prices have been on the rise for years. While renewable energy can push prices down during the day, demand can skyrocket in the evening when solar stops, increasing energy prices. This gap in power during high-demand times is filled by pricier gas and coal-based electricity, which push prices higher than cheaper renewables.
Ageing coal power stations
Many of Australia’s coal stations are over 40 years old, which is near or past their operating life, requiring more maintenance. Breakdowns and outages can drive up wholesale prices, especially when gas is needed as a backup power source.
Weather conditions
More and more of our energy is coming from wind and solar, so the weather is having a higher impact on Australia’s energy market than ever. Low wind or solar output can reduce our supply of clean energy, meaning we need to fall back on other, more expensive power sources. Extreme weather events like heatwaves and fires can also damage energy infrastructure, which can mean added costs on your bills.
How much have energy bills increased in recent years?
Australian homes saw their electricity bills climb around 34% in the 4 years to 2024–25. National median market plan prices jumped from $1,675 in 2021–22 to $1,875 in 2024–25. Some of the biggest price increases can be seen from 2022–23 to 2023–24, where the average market price in most states increased by a few hundred dollars.1Australian Energy Regulator – Annual Retail Market Report 2024–25
Across Australia, average gas bills also saw a steady increase. Median market plans in NSW jumped from $1,557 to $1,927 from 2021–22 to 2024–25, with plans in the Australian Capital Territory increasing from $1,081 to $1,329 during the same period. In South Australia, prices have increased from $838 to $1,116, while in Victoria, bills jumped from $1,154 to $1,616. Queensland, while having lower annual bills, has still seen a jump from $660 to $726.2Australian Energy Regulator – Annual Retail Market Report 2024–25
Median market electricity price changes in Australia
| State | 2021–22 | 2022–23 | 2023–24 | 2024–25 |
| NSW | $1,743 | $2,177 | $2,438 | $2,398 |
| Qld | $1,715 | $1,997 | $2,475 | $2,567 |
| ACT | $1,752 | $1,982 | $2,074 | $2,219 |
| SA | $1,758 | $2,045 | $2,442 | $2,372 |
| Vic | $1,408 | $1,530 | $1,748 | $1,693 |
Note: These figures reflect indicative median electricity market plans for NSW, Qld, ACT, SA and Vic based on data from the Australian Energy Regulator and rounded where appropriate. Estimates include internal iSelect calculations applied to this data. Actual costs may vary depending on location, plan and usage. Based on data from June 2021 to June 2025.
Median market gas changes in Australia
| State | 2021–22 | 2022–23 | 2023–24 | 2024–25 |
| NSW | $1,577 | $1,852 | $1,918 | $1,927 |
| Qld | $660 | $738 | $743 | $726 |
| ACT | $1,081 | $1,152 | $1,302 | $1,329 |
| SA | $838 | $993 | $1,096 | $1,116 |
| Vic | $1,154 | $1,482 | $1,628 | $1,616 |
Note: These figures reflect indicative median gas market plans for NSW, Qld, ACT, SA and Vic based on data from the Australian Energy Regulator and rounded where appropriate. Estimates include internal iSelect calculations applied to this data. Actual costs may vary depending on location, plan and usage. Based on data from June 2021 to June 2025.
Helpful tip
Energy retailers can only raise their prices once a year, and it usually happens around July when the Victorian Default Offer or Default Market Offers are set. If your retailer raises their prices, they can’t raise them again for another year. This means timing your comparison after the price increases are announced could be the key to finding a cheaper plan that suits your needs.
Julia Paszka
General Manager – Utilities
Will energy prices go down?
In the short term, there could be some relief on the horizon. For Australians on the east coast, electricity costs are expected to fall from July 2026. Increased power generated from wind turbines, batteries and falling electricity contract prices could mean up to around $200 in savings for some households in Queensland or New South Wales,3AER – AER release Draft Default Market Offer 2026-27 while Victorians could see savings of around $46 compared to 2025–26.4Essential Services Commission – Victorian regulator publishes draft default electricity price
Looking long-term, however, it’s unlikely that energy prices will drop all that much; prices are estimated to increase more than inflation.
What can Australian households do when energy prices rise?
Comparing energy plans is one of the simplest steps to take when energy prices rise. You can also consider switching to solar to use more of your own energy before buying from the grid, upgrade appliances for better energy efficiency and better understand your energy usage to see where you could cut costs.
Compare plans
When energy prices climb, staying with the same electricity provider or on the same plan could cost more than you think. Around 37% of homes pay more than they should for electricity. By comparing plans, these households could save an average of $291 and find a plan that fits their needs and budget better.5Climate Council – Power games: Who’s driving high power bills? iSelect can help with this.
Switch to solar
Switching over to solar power can save your home from relying on fluctuating energy prices. While solar could help you save around $1,500 per year, it’s still a big up-front investment.6Climate Council – Five reasons why your power bills are sky high – and how we can help bring them down There are, however, government rebates for panels and batteries that can help lower these costs.
Understand your energy consumption
Understanding your household’s energy patterns makes it easier to spot spikes and stay in control of rising costs. Seasonal changes like heavier reliance on heaters during winter or higher usage during school holidays can play a role in the cost of your energy. It’s important to be able to identify these spikes so you know what’s normal for your home and when to adjust things if needed.
Use energy-efficient appliances
Creeping bills mean that every kilowatt matters. Older appliances usually consume more energy than newer ones, which can mean higher energy costs for the same output. By upgrading to a new, efficient model, you could potentially save hundreds of dollars a year, depending on your appliance and usage. Switching from gas to electric stovetops and ovens could also mean more savings annually.
Look into rebates
While the Energy Bill Relief Fund might be over, you could still be eligible for government rebates or concessions that could lessen the impact of rising energy prices. If you’ve applied for any rebates or concessions, make sure they’re applied to your energy bills.
Compare energy plans and help get some control over your bills
Rising gas and electricity prices don’t mean you’re stuck paying more. Comparing energy plans could help you find a great deal that suits your home and usage. To make the task even easier, you can get iSelect to do all the heavy lifting for you. Compare online from a range of providers and plans or talk to our comparison experts on 1800 664 532 for more help tackling these rising energy prices.
Get started on comparing energy plans today!
Save time and effort by comparing a range of energy plans with iSelect
iSelect does not compare all energy providers or plans in the market. The availability of plans may change from time to time, depending on who iSelect’s providers are and what plans they make available to iSelect. Not all plans made available from iSelect providers may be compared by iSelect either due to commercial arrangements, area or availability, so not all plans or providers compared by iSelect will be available to all customers. Some plans and special offers are available only from iSelect’s contact centre or website. Energy plans are available only for properties located in eligible areas of Victoria, New South Wales, South East Queensland, South Australia and ACT. Click here to view iSelect’s range of providers.