Electricity bills have surged 27.16 per cent higher than inflation in two years after the average household cost jumped, a new report claims.

According to energy comparison service iSelect, the average household electricity cost rose from $0.361/kWh in June 2023 to $0.389/kWh in June 2025.

The price increased by 7.63 per cent while the consumer price index, the key indicator of inflation, rose by 6 per cent in that same period.

iSelect utilities general manager Julia Paszka said: “Overall, the research reveals that while Australian households are facing above-inflation increases in their electricity bills.”

The rates are feared to worsen after the monthly inflation indicator rose to the highest level in a year at 2.8 per cent in July, exceeding the 2.3 per cent economists had been expecting.

eToro market analyst Josh Gilbert said the figures were a “sharp reversal from the steady disinflation we’ve seen over recent months and takes inflation back towards the top of the RBA’s target band”.

“This suggests price pressures are proving stickier than policymakers had hoped, particularly in housing,” he said last month. 

Electricity prices were also hiked from July 1, after costs were adjusted to the Australian Energy Regulator’s new default market offer (the legislated ceiling price for electricity prices).

NSW residents saw the sharpest increase of up to 9.7 per cent, while south-east Queensland saw up to 3.7 per cent, and South Australia saw up to 3.2 per cent.

Australian Energy Regulator chair Clare Savage attributed the price rise to increasing transmission and wholesale electricity costs.

“We know this is not welcome news for consumers in the current cost-of-living environment,” she said earlier this year.

“Sustained pressures across almost all components of the default market offer have driven these price rises, with wholesale and network costs rising in most jurisdictions between 1 per cent and 11 per cent, and retail costs between 8 per cent and 35 per cent compared with last year.”

Households can, however, expect to see some relief on their last two quarterly bills this year with two $75 energy rebates to be applied.

The federal government extended the rebates from July 1 to the end of 2025, but has indicated it would not extend the policy to next year.