Business NSW recently released a member alert titled Gas and Smart Renewables Best for Business Right Now, where CEO Daniel Hunter discusses the growing challenge of rising energy costs. If your business is struggling with higher energy bills, you're not alone. But what exactly is going on? And what can be done about it? This is a topic that’s becoming increasingly critical for businesses across the country. So, let’s break it down.

 

Why Are Energy Prices on the Rise?

If you’re running a business that relies heavily on energy, like manufacturing, cold storage, or data centres, you may already be feeling the pinch of soaring energy costs. The issue lies in the outdated structure of the energy market. Daniel Hunter points out that large energy users are paying far more than they should because of a lack of competition, excessive regulations, and costly infrastructure charges.

Take, for example, Morgan Engineering, a business based in Singleton, NSW. Despite operating for 50 years and employing 120 people, their annual energy bill is already between $250,000 and $300,000. With increasing costs linked to connecting renewable energy to the grid, they face even higher bills ahead. If prices continue to rise, tough decisions could follow, cutting apprenticeships or reducing their community contributions. And this situation isn’t unique

 

The Impact on Your Business: Why It Matters

For businesses across Australia, these rising energy prices are not just an inconvenience, they’re a serious threat. The higher your energy costs, the more pressure there is to pass those costs on to customers or make cuts in other areas, like staff or services. Some businesses are even considering relocating interstate or overseas, where energy is more affordable. If this trend continues, it could lead to significant job losses and a decrease in business investment right here in Australia.

 

What Business NSW Is Doing to Support Business

Business NSW is actively working to address the issue and ease the pressure on businesses. Here’s what they’re advocating for:

  • Reducing Transmission Costs: Business NSW is calling for the government to cover part of the costs associated with building energy infrastructure. This would help lower the burden on businesses’ energy bills and make pricing more predictable.
  • Increasing Domestic Gas Supply: They’re also advocating for a relaxation of restrictions on gas exploration. By increasing supply, they believe gas prices can be brought down, providing businesses with more affordable energy options.
  • A Hybrid Energy Solution: In the short to medium term, Business NSW supports a combination of gas and smart renewables. This approach would provide reliable and affordable energy while also enabling a transition to cleaner energy in the future.

 

Why This Is Important for You

Energy costs are a significant concern for businesses. Rising prices put a strain on profitability and competitiveness. If energy costs continue to climb, you may face difficult decisions about how to keep your operations running smoothly. However, with the right reforms in place, these pressures can be alleviated. Business NSW is advocating for policy changes that could help bring more affordable and stable energy prices, ensuring businesses remain competitive and sustainable.

 

What You Can Do to Help

While Business NSW is working on behalf of businesses to bring about these changes, staying informed and voicing your support for the proposed reforms can help. Your involvement can make a difference in pushing for a more affordable energy future.

 

The Future of Business and Energy

The next few months will be crucial for addressing these energy challenges. The solutions being pushed for, such as sharing transmission costs, increasing gas supply, and supporting a hybrid energy model, are key to ensuring that businesses can remain competitive and continue to thrive. These changes will not only impact energy prices but will also help safeguard jobs, investments, and the future of Australian businesses.