An Independent Pricing and Regulatory Tribunal draft report has found that despite electricity price rises of nearly 15 per cent announced this July, the average Sydney household's bill is still lower than five years ago.

"On average, residential customers are paying [???] a real [adjusted for inflation] decrease in prices of 5 per cent," the report said.

But some households are paying $1200 a year more for electricity than others because they remain on less favourable plans.

The report compared the average estimated bill for a Sydney household between 2013-14, when the state government took the controversial step of deregulating the electricity market, and this financial year.

Price increases were previously set by the independent regulator, but deregulation freed power companies with the aim of encouraging them to compete on price, something critics argue has led to price gouging.

The report estimated that the average consumer was only paying about 2 per cent more for their bills since deregulation, which when adjusted for yearly inflation amounts to a lower bill.

But David Blowers, an energy fellow from the Grattan Institute, said the figures were only an educated estimate because it was impossible to determine which plans consumers were on as energy companies did not open their books.

"It could be a very good guesstimate, but we don't know," he said. "There's greater price dispersion [since deregulation]: some people are likely to be on much higher prices; some people are likely to be on much lower prices.

"This is the issue when you move to a deregulated market you just don't know".

Dr Boxall said competition had increased under deregulation, with more brands in the market and the number of households shopping for better offers up from less than two-thirds to more than three-quarters.

But those who remained on "standing offers" with power companies might be paying as much as 25 per cent more for bills, the IPART found, obliging the government to encourage consumers to shop around.

"The bill spread between Sydney households could be as much as about $1200 [a year]," Mr Blowers said.

A steep increase in electricity prices announced this July, of about 15 per cent was driven by a rise in wholesale prices but had been offset by decreases in network costs over the past two years, the IPART found.

The state's opposition, which has said it will re-regulate electricity prices if it wins power at the 2019 election, slammed the report as unrealistic.

"This is complete nonsense," said opposition spokesman for energy Adam Searle. "It's contrary to the lived experience of millions of households. The clear evidence is that deregulation in 2014 led to an increase of 10 to 15 per cent once the retailers were let off the leash, and the problem has only continued to get worse."

But Associate Professor Hugh Saddler of the Australian National University said the previous regime of IPART regulated prices included compensation for electricity companies to offset consumers switching plans, in effect pushing up prices.

"Consumers who engage in the market can access prices that are around 7 per cent lower than they were before prices were deregulated," an IPART spokeswoman said.

The Australian Competition and Consumer Commission has been empowered to investigate the causes of rising power prices. Its final report is due next year.

A preliminary report released on Monday found a major increase in network costs was the main driver of electricity prices, combined with a lack of competition in generation and electricity retail markets, the recent closures of coal-fired power stations and the growing cost of environmental schemes.

"Residential prices have increased [nationally] by 63 per cent on top of inflation since 2007-08," ACCC chairman Rod Sims said releasing a preliminary review this week.