Electricity prices will increase by almost 20 per cent per year in NSW, according to Energy Australia, which blames the closure of coal-fired power stations for the increase.

Following an annual review of tariffs, electricity prices will soar by more than $300 a year for average residential customers, and even more for small-to-medium sized businesses.

Gas prices will also increase by about six per cent for residential customers, and almost 20 per cent for businesses.

The price hikes will take effect from July 1.

“This is bad news for families and businesses and absolutely not what they wanted to hear,” Energy Australia Chief Customer Officer Kim Clarke said in a statement.

Ms Clarke said he believed Dr Alan Finkel’s report, which proposes a clean energy target, was a “good, solid blueprint” for governments to work off.

“A sensible next step is for governments to engage industry and other stakeholders on the Finkel package of reforms to discuss the best way forward,” Ms Clarke said.