Big savings available on electricity in South Australia

South Australian households could save hundreds of dollars by shopping around for a better energy deal, but are still paying more for electricity than households in other dual fuel states and territories, according to the new 2015-16 Australian Energy Regulator (AER) energy retailer performance report[1].  

AER Chair Paula Conboy said there was a temporary reprieve in rising electricity bills for South Australians during 2015-16. For the second year in a row, electricity bills for a low income household on a market offer fell by between 3-4 per cent, but gas bills rose by around 4 per cent. However, many energy bills have risen since 30 June and remain a significant expense for many South Australian households.

“One way to reduce the cost of energy is to shop around, so it is pleasing that 85 per cent of South Australians are now on typically cheaper market contracts for both electricity and gas, the highest proportion of any state or territory,” Ms Conboy said.

A household in the Adelaide area switching from the median standing offer to the lowest market offer could save up to $448 (electricity) and $131 (gas) based on offers available at 30 June 2016.

Ms Conboy said consumers should visit the AER’s price comparator website to see what offers are available. “Our Energy Made Easy website is a simple, independent and free tool to help consumers compare all electricity and gas offers in their area.”

“South Australia recorded the highest rate of customers participating in hardship programs, and the second highest number of customers successfully completing hardship programs nationally,” Ms Conboy said.

“Despite this, energy retailers have reported the highest rates of electricity and gas disconnections in South Australia, at 1.39 per cent and 1.23 per cent of total electricity and gas customers respectively, and also the highest rates of electricity debt and average debt among electricity hardship customers,” she said.

“With 5.5 per cent of customers repaying an electricity debt, there is room to do more.”

The AER has developed a new Sustainable Payment Plan Framework to provide further protection for vulnerable consumers. Several retailers in South Australia including AGL, Click Energy, EnergyAustralia, Origin Energy and Simply Energy have already signed up to the voluntary Framework that sets standards for retailers to meet when offering payment plans to customers.

“We have worked with financial counsellors, consumer groups and energy retailers to develop a Framework to improve how retailers can assist their customers manage their energy bills. We are shining a light on those energy retailers who have voluntarily agreed to the Framework committing them to improving outcomes for customers struggling to pay their energy bills,” Ms Conboy said.

“If customers are struggling to pay their energy bills we encourage them to contact their energy retailer early and ask for help to avoid being disconnected”.

The AER has also released its annual retail compliance report for 2015-16. South Australian Power Networks was among eight energy businesses to be fined by the AER during the year for breaches of the National Energy Retail Law, paying $120,000 in penalties for failing to provide at least four business days’ notice of any disruption of service to life support customers.

Ms Conboy said breaches of life support obligations are potentially catastrophic and have been the focus of campaigns to increase community awareness and improve compliance.

“We are seeing results in improved network systems and processes to safeguard against potential breaches as they continue to work towards improved compliance. The campaign continues in 2016-17,” she said.

About the AER

The Australian Energy Regulator regulates energy markets and networks under national legislation and rules in eastern and southern Australia, as well as networks in the Northern Territory. Its functions include:

  • monitoring wholesale electricity and gas markets to ensure energy businesses comply with the legislation and rules, and taking enforcement action where necessary;
  • setting the amount of revenue that network businesses can recover from customers for using networks (electricity poles and wires and gas pipelines) that transport energy;
  • regulating retail energy markets in Queensland, New South Wales, South Australia, Tasmania (electricity only), and the ACT;
  • operating the Energy Made Easy website, which provides a retail price comparator and other information for energy consumers;
  • publishing information on energy markets, including the annual State of the energy market report, to assist participants and the wider community.
     

[1] These reports cover jurisdictions that have commenced the National Energy Retail Law. This includes Tasmania (electricity only) and the Australian Capital Territory from 1 July 2012, South Australia from 1 February 2013, New South Wales from 1 July 2014 and Queensland from 1 July 2015.

Segment: 
Issued date: 
22 November 2016
AER reference: 
NR 29/16