Wholesale electricity prices have declined from their recent peak and the large volume of new renewable energy generation expected to come on line may put further downward pressure on wholesale prices (Graph 17). The recent decline in wholesale prices and an increase in competition amongst energy retailers has seen a decline in market offer prices in many states.
Furthermore, many energy retailers have indicated that they will not be changing their standing offer prices in the September quarter, while others have indicated that they will be lowering their prices. As a result, we expect utility prices to decline in the coming quarters. How this plays out over the period ahead is another significant uncertainty for the Bank's inflation forecast.