Less debt, more support for energy customers
Fewer Australians are being disconnected for not paying their bills.
The latest retail energy performance report shows household debt for electricity and gas bills has fallen across most parts of the country, with fewer Australians on payment plans and more households completing hardship programs to avoid disconnection.
The Australian Energy Regulator's (AER) annual retail energy performance report 2015/16 found that while overall affordability remains on par with the previous year's results, there are promising signs Australians are taking advantage of support programs, while an increasing proportion of customers have moved away from standing (or regulated) offers, pursuing generally lower priced market retail contracts.
There was a small decrease in the proportion of South Australian, New South Wales and Tasmanian customers on payment plans, while the number of customers with an energy debt who entered a hardship program increased, particularly in South Australia (1.8 per 100 customers).
"This is an encouraging sign that those struggling to pay their energy bills are getting the assistance they need from their retailers earlier, to avoid being disconnected," AER chair Paula Conboy said.
The performance report found low income households in NSW spend 3.8% of their earnings on electricity bills and 2.8% on gas bills, while South Australians spend 5.2% on electricity and 4% on gas.
The report also found market offers are procuring customers annual savings of up to $454 in some capital cities, depending on the fuel type.
For example, Brisbane residents can save up to $185 on their electricity bills each year and up to $39 on gas, while residents of Adelaide can save up to $448 on electricity bills and up to $131 on gas.
Electricity disconnections decreased in New South Wales (-6%), with disconnection numbers the lowest in three years. Disconnections increased in the ACT (12%), Tasmania (12%) and South Australia (3.6%).
Gas disconnections rose in South Australia (11%), fell in New South Wales (-15%) and were flat in the ACT.
Coinciding with the release of the report, the AER has developed a new Sustainable Payment Plan Framework, setting voluntary standards for retailers in relation to payment plans. The regulator is also reviewing the minimum amount consumers must owe before their energy services can be disconnected.
The AER's annual retail compliance report revealed 26 penalties were issued in 2015/16, totalling $520,000, including six penalties for retailers failing to seek proper consent before switching customers and 20 penalties for distributors failing to provide required protections to life support customers.
Use our comprehensive guide to compare and contrast different offers from a variety of energy suppliers.