AER report shines spotlight on ACT energy market

The Australian Energy Regulator has released its first annual performance report on the retail energy market under the National Energy Retail Law, which started in the Australian Capital Territory on 1 July 2012.

The report looks at the retail market and retailers’ performance including number of active retailers, customer switching rates, customer service levels, with mystery shoppers used to assess the performance of retailers’ call centres. ActewAGL, with over 96 per cent of household electricity customers, is the dominant retailer in the ACT. Further over 80 per cent of customers are on standard contracts for gas and electricity.

During 2012-13, over 3000 complaints were made to retailers by ACT customers, with billing, prices, and marketing the most common causes of complaint.

The report also looked at average energy debt levels in the ACT and found that, at the end of June, just over 4000 electricity customers (3 per cent) had amounts owing to their retailer for 90 days or more, with the average debt being around $800. In gas, 7,000 customers (6.5 per cent) had debts, with the average debt around $535.

The report outlines the assistance being provided by energy retailers to help their customers—at the end of June around 590 electricity customers and 240 gas customers were on payment plans and an additional 1000 customers were on hardship programs. Only 73 residential electricity disconnections for non-payment were carried out in the ACT during 2012-13 whilst 1572 residential gas customers were disconnected over the year.

Mr Reeves said that the 2012-13 report highlighted the importance of this assistance to households.

“The Retail Law provides important protections for consumers. Energy retailers have to offer payment plans to customers who are having difficulty paying their bills, or more comprehensive hardship assistance for eligible customers,” Mr Reeves said.

“Customers who are having trouble paying their energy bills should contact their retailer as soon as they know they will have a problem. Early assistance can help customers avoid building up higher levels of debt, avoid extra fees or having their service disconnected.”

Mr Reeves also said that customers should consider shopping around and switching offers. The AER’s energy price comparison website, Energy Made Easy, and is an independent free and easy to use tool to help consumers compare different energy offers.

“The difference between the highest and lowest priced offer in any given area can be several hundred dollars over a year, so clearly it can pay to shop around.” Customers can also talk to their current retailer to see they if can get a better offer.

“The AER will continue to closely monitor retailers’ performance on hardship issues to ensure that customers are getting appropriate access to payment plans and hardship assistance. We are commencing a broader review of retailers’ hardship programs in early 2014,” Mr Reeves said.

The report also features findings on energy affordability, and the impact of energy bills on the budgets of benchmark households in the ACT. At June 2013, annual electricity bills for a benchmark ACT low income household in receipt of an energy concession came to $1423—less than 3 per cent of their annual disposable income. This assumes that a low income household has the same level of usage as other ACT households of comparable size. Compared to a benchmark middle and high income household, annual electricity bills came to $1769 and comprised only 1 per cent and 0.4 per cent of disposable income respectively. Annual gas bills came to $683 for a benchmark low income household receiving a concession, or 1.4 per cent of disposable income. For middle and high income households this represents 0.4 and 0.2 per cent of disposable income respectively.

To compare energy offers, visit www.energymadeeasy.gov.au

Issued date: 
26 November 2013
AER reference: 
NR 031/13
Contact: 
Ms Meg Macfarlan, AER media unit 02 6243 1317 0408 995 408