First electricity, now we face big rise in gas prices

AGL has applied to the NSW government pricing regulator IPART, the Independent Pricing and Regulatory Tribunal, to raise gas prices by an estimated 10.4 per cent from mid-next year, with further steep, although unspecified, price rises expected over the following two years.

Rising gas exports from eastern Australia will push up domestic prices since international prices are more than twice as high.

The impact is compounded by the fact that AGL's long-term gas purchase contracts from producers are expiring over the next few years, leaving it fully exposed to an expected surge in gas prices.

As it has yet to finalise its new gas purchase contracts, AGL has not indicated the likely rise in gas prices that will occur in 2014-15 and 2015-16 in its application to the regulator.

The rises come in the wake of large rises in electricity prices, with increases of up to 20 per cent taking effect from July 1 just the latest.

"The last thing NSW families need is yet another skyrocketing bill from the O'Farrell Government, this time in the form of gas prices," the State Opposition energy spokesman, Ron Hoenig, said.

"Gas bills for AGL customers ... would rise by an extra $84 each year from July if the O'Farrell Government passes on this price hike.

"Barry O'Farrell has already passed on a whopping 38 per cent increase in household electricity bills and NSW families can't afford another hit to the weekly budget."