Power prices remain one of the biggest operating pressures facing Victorian businesses. In a recent discussion on 3AW with Tom Elliott, Power Maintenance Managing Director Nick Halaris explained why electricity costs continue to rise, what is driving pressure across the grid, and why reliability matters as Victoria moves through the energy transition.
The conversation covered network charges, renewable integration, battery storage, coal-fired power station closures and the practical impact on businesses already managing tighter margins.
Below is a summary of the key points from the interview, followed by the full transcript.
Watch Nick Halaris speaking with 3AW’s Tom Elliott about rising power prices for VIC businesses, energy reliability and what Victorian businesses should be watching.
Key takeaways from Nick Halaris’ 3AW interview
Nick Halaris discussed the real pressures behind rising power prices, including network charges, grid reliability, coal closures and what Victorian businesses should be watching closely.
Power prices are being driven by more than wholesale costs
Electricity bills are shaped by generation, network charges, transmission investment and the cost of keeping the grid reliable.
Network charges are becoming harder to ignore
Poles, wires and transmission upgrades are playing a bigger role in business electricity costs across Victoria.
Batteries help, but they are not the whole answer
Battery storage can support the grid, but it does not replace the need for reliable power when renewable output is low.
Coal closures need careful planning
As coal-fired generation exits the grid, replacement capacity needs to be reliable, dispatchable and ready in time.
Businesses are exposed to price volatility
Victorian businesses can be hit hard when contract timing, tariff structures or demand charges are not managed properly.
Energy strategy needs to be proactive
Waiting for bill shock is risky. Businesses should review contracts, usage and tariffs before costs rise further.
What Nick Halaris discussed on 3AW
During the 3AW interview, Nick Halaris explained that rising power prices are not being caused by one single factor. Victorian businesses are facing pressure from a combination of generation costs, network charges, transmission investment, renewable integration and the broader cost of maintaining reliability across the electricity grid.
A key part of the discussion focused on the difference between renewable energy generation and reliable, dispatchable power. While solar, wind and battery storage all have important roles to play, Nick highlighted the need for a balanced energy system that can support businesses when renewable output is low or demand is high.
The interview also touched on coal-fired power station closures, the limits of battery storage, and the practical reality facing manufacturers, commercial operators and other large energy users. For many businesses, energy strategy is no longer just a procurement issue. It is becoming a risk management issue.
That is why Victorian businesses should be reviewing their electricity contracts, tariff structures and usage patterns before price pressure becomes more difficult to manage.
Full transcript: Nick Halaris on 3AW with Tom Elliott
The transcript below has been lightly edited for readability while preserving the meaning of the original conversation.
Interview transcript
Tom Elliott:
A couple of months ago, we auctioned off a day in the studio. All the money raised was donated to the Royal Children’s Hospital Good Friday Appeal.
Our next guest very generously stumped up $26,000 for the privilege of watching this show being prepared and now presented.
He is the Managing Director of Power Maintenance Energy. He is an energy expert. Nick Halaris, good morning.
Nick Halaris:
Good morning. How are you?
Tom Elliott:
Very good. So, very quickly, what is your business, Power Maintenance Energy? What does it do?
Nick Halaris:
What we do is look after the big end of town, including large industrial and commercial customers. That generally means anyone using over 40,000 kilowatt hours, who usually pay roughly 30% less than normal small business customers.
We mitigate risk. We negotiate contracts at the right time. When the market is up, we do not negotiate. When the market comes down, we negotiate and lock customers in.
We basically save customers money on network charges, budgets, and build strategies around them saving money to stay in business.
Tom Elliott:
So essentially, you go and negotiate with the power companies to get a better deal on power for these big businesses, because they use a lot of power.
Nick Halaris:
That is correct, as well as network charges.
There are different types of strategies on the market that businesses can adopt and adapt to their business models to save on cost, because network charges are on the increase.
Tom Elliott:
That, of course, is something households are seeing as well. In fact, I think there is a proposal to have even larger network charges now to pay for all the new poles and wires and transmission lines being built here in Victoria.
Nick Halaris:
That is correct. New South Wales is looking at around a 19% increase.
Victoria will follow suit very soon because all these renewable energy projects need to come onto the main lines, and that is what is happening.
Tom Elliott:
Just on renewable energy, I have real doubts. I know we are investing a lot in solar and we are building VNI West to transmit solar energy from New South Wales into Victoria. We have wind farms planned all over the place, although not built yet.
But in this state, we are very heavy users of both gas and electricity.
We are planning to shut down the remaining coal-fired power stations within the next 10 years. Do you think we are going to be okay when it comes to electricity?
We have always been used to it. It might be expensive, but you turn the switch on and the power is available.
When we get rid of those coal-fired power stations in the next five to 10 years, are we going to have enough power to go around?
Nick Halaris:
No. No way.
The problem is baseload generators are the most important and key ingredient in the market.
If you price them out of the market and throw all these renewables on without baseload power, you are going to have blackouts everywhere.
Tom Elliott:
In South Africa, they have somehow stuffed up their power grid and blackouts of four to eight hours a day are quite common. People just learn to live with it.
Is that where we are headed, or do you think they will keep the coal-fired power stations open?
Nick Halaris:
They have to keep the coal-fired power stations. They have to find a way to do it, similar to what Germany and China have.
I travel to Germany about this stuff all the time and learn from their market.
Basically, the situation is that you must have baseload power. The other generators can operate onto the market at different times when they are needed.
For instance, solar can operate between 10am and 3pm, and hydro can operate at certain times.
Tom Elliott:
The problem with solar is, if I work a normal day, come home in the middle of winter, it is dark at 5pm and I want the lights on, the TV on, and my electric cooker on because gas ones are now banned.
Solar does not work so well then, does it?
Nick Halaris:
No, it does not.
They are looking at different types of investment like gas and hydro. The problem is these are small band-aid solutions for peaking stations. They are not actual baseload generators.
Tom Elliott:
I have spoken in the past to Lily D’Ambrosio, the State Energy Minister, and she seems to think that if we build enough batteries, we can have solar feeding into giant batteries during the day and then at night Melbourne, and all of Victoria, can survive off battery power.
Is that realistic?
Nick Halaris:
No. She is not from the industry. She would not understand, unfortunately.
I do not mean that in a bad way towards Lily, because she has been given a portfolio that she does not fully understand from the industry mechanism point of view.
What they need to do is really look at it, because batteries are not a baseload generator.
No matter how many batteries you put in, you are not going to get the result.
“Batteries are not a baseload generator. No matter how many batteries you put in, you are not going to get the result.”
Nick Halaris, Managing Director, Power Maintenance
Tom Elliott:
So, if we do what we are told is going to happen and the coal-fired power stations are shut down, what is the alternative?
Nuclear is off the agenda. Is building gas-fired power stations the only alternative we have?
Nick Halaris:
We have a lot of water around us as well. We have hydro. There is a lot of technology.
Hydrogen is not far off. I am over in Munich in a few weeks having a look at hydrogen technology and how quickly it is moving in the market. We are not far off.
Tom Elliott:
Even hydro, as in water rather than hydrogen, has issues. Snowy 2.0 has taken much longer and they reckon it is going to cost $40 billion now, versus the original cost of $2 billion.
As a signature hydro project, it has not worked all that well, has it?
Nick Halaris:
No. This is the result.
The problem is you have to pump the water back up the mountain, and off-peak prices are up as you take out coal-fired generators.
So, is it worth pumping the water back up at night to generate during the day, or do you do it the other way around?
Tom Elliott:
I look at this and still think we have lost an opportunity by not going towards nuclear power.
Is the solution that we just have to have an about-face and keep the coal-fired power stations open? Is that what you think will happen?
Nick Halaris:
China and Germany are moving to more efficient coal-fired power stations.
I think the government really needs to look at brand new, more effective coal-fired power stations.
Tom Elliott:
But ideologically, they have to get over this opposition to coal-fired power stations, don’t they?
Nick Halaris:
They really do.
When everyone loses power, there are going to be more problems, and it is going to cost manufacturing. It is going to cost a lot of businesses.
Tom Elliott:
For the average household, I have solar panels and quite a small battery. I think it is about 4kW or something. It has cut our power bills, but you could not live off it all the time.
Is the future that, if you are a household, you have as many solar panels as you can, as big a battery as you can afford, and maybe your own petrol generator to kick in if a blackout comes?
Nick Halaris:
It is looking that way, unfortunately, with the way they are going about it.
I think the future is microgrids, where the government needs to really get involved in the way they are putting batteries out.
They could effectively provide batteries and use part of the load left on the battery. They discharge that during the day when they need it and make money off the spot market to fund future investment, including future projects such as nuclear power.
You can do it if you play the spot market and know what you are doing.
Tom Elliott:
But again, you have to get over the idea of nuclear power. That was Peter Dutton’s policy, and they do not want to be like Peter Dutton.
Anyway, let’s go to a call. Josh, good morning.
Caller:
I have read recently that Japan has been using micro power stations, attaching them to rivers, hydro desalination plants, and using these micro areas and generators for smaller areas rather than one big bulk area.
With all of our rivers and everything we have in Australia, surely those micro options for rivers and generators would be an option for us?
Tom Elliott:
Although we do have droughts at times. There is a famous picture of a drought 100 years ago where you could drive a horse and cart down the Murray River because there was no water in it.
But I have read ideas like having some sort of massive generator at the mouth of Port Phillip Bay, where tidal surges coming in and out would turn it.
Is there any truth to these things? Could they work?
Nick Halaris:
It can work.
Foreign investment is one of the mechanisms that you can bring into the market. It can work. All this stuff is working overseas.
That is why it is important for the government to look overseas and see how others are coping while trying to hit that 30% or 20% target drop.
Tom Elliott:
We are trying to go to 82% by 2035, is that right?
Nick Halaris:
That is right. That is correct.
2035 is nine years away. These things, even if they work, have to be built now.
The next five years are going to be the most volatile in the market, I think, and we need to be looking at absolutely everything.
Tom Elliott:
All right. Thank you so much for coming in today.
You have been watching the show being made. Has it been what you expected it would be, or has it been a bit different?
Nick Halaris:
It is organised chaos, like my team at work.
But you have a brilliant crew around you and a great team, so well done to everybody here who has shown me around.
Good on you guys. They are a brilliant team.
Tom Elliott:
That is Nick Halaris, energy broker and Managing Director of Power Maintenance Energy.
If you are in business, you know how important energy costs are to your bottom line. The politicians keep telling us power will get cheaper. We have heard that a few times, but we know it is not.
That is why, if you are in business, you need to speak to Power Maintenance.
They provide top-notch power maintenance solutions to businesses of all sizes, with their expertise in gas, electricity and LPG markets.
Nick and the crew have decades of experience in the sector, helping your business deal with rising network charges, shifting wholesale markets and contracts that can expose you and your business to unnecessary risk.
Their team has spent more than a decade working with manufacturers, cold storage facilities, hospitality groups and multi-site businesses, each with different challenges.
Having the right electricity broker in your corner ensures you are not navigating this complexity alone.
Visit powermaintenance.com.au or call Nick and the team on 1300 700 500.
“The next five years are going to be the most volatile in the market.”
Nick Halaris, Managing Director, Power Maintenance
“For many businesses, energy strategy is no longer just a procurement issue. It is becoming a risk management issue.”
Power Maintenance
Frequently asked questions
Below are some of the key energy market questions raised during Nick Halaris’ 3AW interview with Tom Elliott.
Why are power prices rising for Victorian businesses?
Power prices are rising because businesses are being affected by several cost pressures at once. These include wholesale energy costs, network charges, transmission investment, renewable integration costs and the broader cost of keeping the electricity grid reliable.
What are network charges on an electricity bill?
Network charges are the costs associated with moving electricity through poles, wires, substations and transmission infrastructure. For many businesses, these charges can form a significant part of the total electricity bill, especially as more grid investment is required.
Are batteries enough to replace baseload power?
Batteries can play an important role in supporting the grid, especially during short periods of high demand. However, battery storage is not the same as baseload or dispatchable generation. A reliable electricity system still needs firm capacity that can operate when renewable output is low.
Why do coal-fired power station closures matter to businesses?
Coal-fired power stations have historically provided large amounts of reliable generation. As they close, replacement capacity needs to be ready, reliable and commercially viable. If firm replacement capacity does not arrive in time, businesses may face higher price volatility and reliability risk.
What does energy reliability mean for commercial and industrial businesses?
Energy reliability means having access to electricity when it is needed, at a cost that allows the business to operate sustainably. For manufacturers, cold storage operators, hospitality groups and other energy-intensive businesses, reliability issues can affect production, margins and long-term planning.
How can Victorian businesses reduce energy cost risk?
Businesses can reduce energy cost risk by reviewing their electricity contracts early, checking tariff structures, monitoring demand charges, understanding usage patterns and seeking advice before contract expiry. Waiting until prices rise or a bill shock occurs can limit available options.
When should a business review its electricity contract?
A business should review its electricity contract well before the current agreement expires. This gives the business more time to compare options, assess market conditions and avoid being forced into a rushed decision during a volatile pricing period.
