Electricity bills to rise by $40 from mid next year, Australian Energy Market Commission says.

The average yearly electricity bill will be jacked up by $40 dollars from the middle of next year, an Australian Energy Market Commission report suggests.

AEMC Chairman John Pierce pointed to the Federal Government’s renewable energy target and the closure of Victoria’s Hazelwood coal-fired power station as fuel for the price rise.

“Across the national electricity market the generation mix is changing — with the large-scale renewable energy target leading to substantial investment in wind generation,” he said in a statement.

“This is contributing to the closure of coal-fired plants and increasing wholesale and retail prices.”

The report estimates the closure of Australia’s dirtiest coal-fired power plant has added $78 to the national yearly average power bill, $204 in Tasmania and $99 in Victoria.

The only interconnector between Tasmania’s power grid and the mainland is the Basslink, which starts in Victoria.

This means Hazelwood’s closure has had flow on effects for Tasmania, but it has been offset by a lower price tag for building, operating and maintaining the electricity network.

Tasmania and Queensland are the only states which will not have increased power prices from June.

The ACT will have the biggest increase — the report estimates Canberrans will pay 9.3 per cent more.

Nationally, the 2.7 per cent increase in the national average electricity bill for the 2017/18 year is less than the year before.

For 2016/17, the total average bill for the year is estimated to be $1,353 — a 4.4 per cent increase from the year before.

The report also said the price hike was expected to slow as new wind power came online.

The energy report is one of many released while the Government reviews its renewable energy policy.

Prime Minister Malcolm Turnbull has said he will not introduce an emissions trading scheme

This post originally appeared on ABC News.

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