Queensland households could be accessing more support from their energy retailers to manage their electricity and gas debts, according to the new 2015-16 Australian Energy Regulator (AER) performance report[1].
The report looks at energy affordability as well as other indicators of the performance of retail energy markets, including assistance provided by retailers to customers experiencing payment difficulties, rates of disconnections for non-payment and customer service and complaint levels.
AER Chair Paula Conboy said this is the first year Queensland statistics have been included in the AER’s national report on how consumers are faring in the retail energy market.
Retailers in Queensland have reported that around 3.5 per cent of all customers are repaying an electricity debt, with less than 1 per cent being assisted under their retailers’ hardship program to manage their bills.
“Hardship programs provide the highest level of support to customers who are struggling to pay their energy bills and we encourage customers having difficulty to contact their retailer to access that support,” Ms Conboy said.
“Just over 1.1 per cent of Queensland households were disconnected for unpaid electricity bills in 2015-16, the second highest rate in Australia.
“We are concerned about those struggling to pay their energy bills and would like to see earlier retailer engagement with vulnerable customers to identify those who may need assistance through hardship programs or payment plans.”
The AER has developed a new Sustainable Payment Plan Framework to provide further protection for vulnerable consumers. Several retailers in Queensland including AGL, Click Energy, EnergyAustralia, Ergon Energy, Locality Planning Energy, 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.
“Despite households in the Energex zone being able to choose from a range of 120 market and 67 standing electricity offers as at 30 June 2016, energy bills remain a big expense for many people,” Ms Conboy said.
“Low income households in Queensland are spending on average 4.3 per cent and 2.6 per cent of their disposable income on electricity and gas to run their homes,” she added.
Ms Conboy said one way to reduce the cost of energy is to shop around. “We encourage consumers to use the AER’s Energy Made Easy website which is a simple, independent and free tool to help consumers compare all electricity and gas deals in their area."
The AER has also released its annual retail compliance report for 2015-16. Queensland distribution networks Energex and Ergon Energy were among eight energy businesses to be fined by the AER during the year for breaches of the National Energy Retail Law, paying $80,000 and $40,000 respectively in penalties for failing to provide at least four business days’ notice of any disruption of service to life support customers.
“Breaches of life support obligations are potentially catastrophic and have been the focus of campaigns to increase community awareness and improve compliance,” Ms Conboy said.
“Results are being seen 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.”
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.