South Australian household gas bills to drop $30 a year as natural gas network charges reduce 8%

More than 455,000 households and small businesses connected to natural gas in South Australia are set to receive significant reductions in their bills, on average ranging from about $30 to $270 per year respectively.

Residential reward

This follows Australian Gas Networks’ (AGN’s) publication of its South Australian Draft Plan for the five-year period commencing 1 July 2021. The Draft Plan was developed following an extensive period of consultation with customers and stakeholders.

The Draft Plan proposes an 8% reduction to gas distribution charges in real terms from 1 July next year. This follows on from a 23% real reduction delivered at the beginning of the current period on 1 July 2016. The gas network charges make up about a half of the average residential bill in South Australia.

AGN estimates the average flow-on effect to its (444,000) residential and (11,000) small business customers in South Australia will culminate in their gas bills dropping by about $30 to $270 per annum respectively from 1 July 2021, assuming other components of the bill do not change.

In South Australia, AGN delivers natural gas to customers across Adelaide and regional centres such as Mount Gambier, Port Pirie, Whyalla and the Riverland.

AGN Chief Executive Officer, Mr Ben Wilson said: “Our proposed reduction in gas network charges will take some of the pressure off household and small business gas bills.

“During our 12-month engagement process our customers have told us that price and affordability is the top priority. The proposed price cut will improve the affordability of natural gas for our new and existing customers in South Australia,” Mr Wilson said.

“The Draft Plan outlines our ongoing mains replacement program, which whilst underpinning our commitment to reliability will also achieve a key safety milestone, seeing the remaining 550km of low-pressure cast iron pipes replaced by 2025/26.”

“The Draft Plan also sets out the potential role of gas distribution networks in a low carbon energy future in South Australia, and explores the steps we are taking today to transition the network to renewable gases such as hydrogen and biomethane.”

The Draft Plan is available at Gas Matters (gasmatters.agig.com.au), AGN’s online engagement portal.

AGN is inviting submissions on the Draft Plan by 17 April 2020.

“The Draft Plan provides an opportunity for our customers and stakeholders to understand and comment further on our approach before we submit our Final Plan to the Australian Energy Regulator (AER),” Mr Wilson said.

AGN will formally lodge its plans with the AER by 1 July 2020 in the form of a revised Access Arrangement for the 1 July 2021 to 30 June 2026 period.