Submissions Close Today On AEMC Plan To Raise Fixed Charges

Are the authorities running Australia’s main grid quietly out to ruin us all? Certainly seems they are.

Read on why I explain the lunacy and what you can do about it, right now, because time is of the essence.

There’s a proposal on the table that could restructure how we all pay for electricity. They want us all to pay more in fixed charges.

The Australian Electricity Market Commission is the body charged with making up the rules and they’re calling for submissions on the change, as part of electricity pricing reforms included in a recent draft review. Trust me this is not good news for consumers.

The Shift To Fixed Charges

The proposed new rule change will shift more of your bill into fixed charges. That means you would pay more just for being connected, even if you use less power, even if you’ve insulated your house, even if you’ve spent thousands on solar and a battery, even if you are doing everything right.

If this change goes ahead:

• Solar and battery homes could pay $400–$680 more per year;
• Clean energy systems will take longer to pay for themselves;
• Low-use households will be hit hardest.

If you live in a small home, an apartment, or you simply use very little power, you may end up paying more per unit of energy than someone who runs ducted air con all summer.

It’s simply perverse. It tells people that saving energy does not save as much money as it should.

We Have Always Paid Two Ways

There’s a fee for access to the grid, and then there’s a charge for the energy you use. It’s not unlike driving, where private motor vehicles pay one way and heavy transport pays differently.

1. In a light vehicle (4.5 tonnes max) you pay registration for access to the network, and then fuel excise (supposedly) funds the maintenance of the roads according to how many kilometres you drive. Fuel is the major cost, so you have an incentive to ride your bike.
2. In a truck you pay much higher registration costs. Truckies are buying the right to have more wheels, 6 or 9 Tonnes per axle in fact. More weight means more wear, on roads that have to be better built to withstand the load.

Right now, most homes pay low fixed daily charges, while charges for power used are relatively high. The more kilowatt hours you use, the more you pay. If you install solar, cut your usage, or add a battery, your bill falls because you buy less from the grid.

Industrial Customers Get The Other Deal

Big users pay for the load they can put on the grid, or size of the wires. It’s called a demand charge, so if you have a petrol station, supermarket or nursing home, you’re paying for a big fat connection to feed you power, but the actual cost of the units you’re guzzling is relatively low.

Demand charges can be a trap. Years ago they only applied to industrial users, so a winery which only uses bulk power for crushing season would be crippled with year long contracts for a couple months peak use.

While networks have moved to setting the demand charges each month, they’ve also managed to have rules changed so this pricing model can be applied to small customers. That horse bolted years ago.

If you’re subject to demand charges under your retail bill, you could be stung for an expensive month, because just one day you had a party, simultaneously air conditioning, cooking and drying the clothes for that kid that fell in the pond…

Lowering Demand Is Good

Some operatives whinge that solar customers put expense on the grid, but that’s only because there needs to be some smarter hardware to control the network. What they ignore is that solar behind the meter lowers grid demand. The poles and wires need not be as big so we don’t have to go around gold plating the infrastructure to make sure things don’t melt in a heatwave.

As the wholesale price of power has risen, commercial users have moved to solar because solar is cheaper AND it can reduce their demand as well. In fact Chadstone shopping center has a shipping container sized battery just to lop the peak off their bill.

The thing is that networks hate that too. They don’t get paid for shifting electricity per se, they’d rather build big expensive assets because they get paid a regulated fixed amount, based on the value of the network assets. Gold plating means they get paid more, so having an engaged consumer with efficient habits and solar to back them up is really bad for business.

AEMC has plenty of history to refer to so we can see who”s got their hand out for more.

The Business Is Broken

When the government owned the network, there was a steam engine at the hub and spokes delivering electricity to you. As soon as solar hit the market, you had some choice on where to buy your power. Thankfully, the authorities didn’t see the threat emerging. They didn’t try throwing up rules and obstructions because solar was too expensive and would never work, bless them.

Now we have some jurisdictions where fully half the customers have solar, whole states run off it during the day and cheap batteries are causing consumers to just vanish. It’s almost as dramatic as exploding a steam turbine.

The remains of “reliable coal” at Calide in Qld. otherwise known as the longest unplanned outage on the NEM.

Solar Systems Will Wither

If more of the bill becomes fixed, the payback on smaller or older solar systems stretches out.

That matters. It’s a classic unintended consequence.

Many homes installed 1.5kW or 3kW systems a decade ago. They are simple, they work, and they still cut bills. But if savings shrink, fewer people will bother maintaining them. Some won’t replace ageing inverters. Others won’t upgrade at all.

Over time, thousands of small systems will quietly drop off, effectively laying waste to the STC subsidy paid for the glass on the roof too.

That’s not just bad for those homes. It denies the broader grid a steady stream of clean energy generated right where it is used. Rooftop solar reduces strain on poles and wires, especially in the middle of the day when demand used to spike.

Small systems might look minor on their own. Together, they are a power station spread across the suburbs.

The Battery Boom Needs More Generation

At the same time as large-scale wind and solar face delays, the big gentailers are racing to build large batteries.

Why? Because batteries are fast to approve and quick to build. Compared to a wind farm and a new transmission line, a battery is simple, but a battery does not generate energy. It just time shifts it.

As more and more large batteries come online, they will be scrabbling for cheap clean generation to charge from. Without enough new wind and solar, batteries end up charging from whatever is available. This could extend the short term profits of fossil fuels while continuing to fundamentally undercut them.

In other words, we can’t build storage without also building supply, and we can’t afford to weaken rooftop solar at the same time large projects are being held up.

All this will lead to is a disorderly transition, unexpected closures, subsidies for clapped out plants and maybe even the rolling blackout scenario that seems to be a wet dream for those who’ve always denied the need for change.

Liddel is at the bottom of this list and it’s something like 560% more powerful with 865% more storage than the “World’s Biggest Battery” they started with in South Australia.

This Change Will Push People Off Grid

The solar installation industry will continue going gangbusters, because those who can afford it will be more likely to “go off grid” with publicly subsidised batteries that are no longer helping the broader community.

We’ve explained before this is a terrible outcome, because the wealthy suburbanites choosing to disconnect won’t be helping to pay for the mains running past their house – they’ll be paying even more for diesel generators to keep the heating on overnight.

While those who don’t own a roof, or rely on a pension, will have no choice at all.

Have Your Say Today

This proposal is open for public comment.

If you have solar.
If you are thinking about solar.
If you use very little power.
If you care about keeping bills fair.

Now is the time to speak up.

👉 Submit a comment here

Select:
• Market review submission
• EPR0097 Electricity pricing for a consumer-driven future

You can also read more via the Smart Energy Council here.

This change could tilt the playing field away anyone who’s invested and done the right thing.

A fair grid should reward people who use less and generate clean power, not punish them for it.

Have your say while you still can.

If you want some inspiration, here’s what I’m planning to tell them:

“I oppose the proposed increase to fixed electricity charges under EPR0097.

 

Increasing the fixed portion of bills will unfairly penalise households that use less electricity and those who have invested in rooftop solar and batteries. These households have reduced demand on the grid and made significant private investments to support Australia’s clean energy transition. They should not be worse off because of it.

 

Higher fixed charges reduce the financial benefit of saving energy. That weakens the incentive for households to install solar, maintain or upgrade older systems, add batteries, or improve energy efficiency. Over time, this risks slowing the growth of distributed clean energy that supports the grid, especially during daytime peaks.

 

Small and low-use households will be hit hardest. A pricing structure that shifts more costs into fixed charges disproportionately affects pensioners, renters, apartment dwellers and energy-conscious families.

 

There is also a serious long-term risk. If fixed charges continue to rise, households who can afford solar, batteries and backup systems will increasingly consider leaving the grid altogether. That would shrink the customer base that pays for shared network costs, pushing prices even higher for those who cannot afford to disconnect. This creates a two-tier system and undermines the idea of electricity as an essential service.

 

Electricity networks are natural monopolies and a critical public good. Many Australians already question whether privatisation has delivered lower prices or better outcomes. Even the ACCC has raised concerns about how privatised electricity has failed consumers and the broader economy. Pricing reforms should strengthen trust in the system, not weaken it.

 

At a time when large-scale renewable and transmission projects face delays, locally generated energy in cities and towns is more important than ever. Rooftop solar is not marginal — it is a core part of Australia’s electricity supply. Pricing reforms should encourage participation, not discourage it.

 

I urge the AEMC to protect fair usage-based pricing and maintain strong incentives for households to reduce demand and invest in clean energy.

 

Please reject changes that increase fixed charges at the expense of equity, efficiency and long-term grid stability.”