EnergyAustralia holds Victorian electricity prices flat for 2019

EnergyAustralia, one of the country’s leading energy retailers, today said it would keep electricity prices flat for Victorian households in 2019 by paying more than $15 million worth of increases in supply-chain and other costs.

The decision follows the company’s announcement in June that it would hold steady average FY2018/19 electricity prices for households in New South Wales, South Australia and the Australian Capital Territory, and reduce them for Queensland customers.

Had EnergyAustralia not paid to keep prices flat, the retailer’s average household customer in Victoria would have faced a 1.9 per cent or $39 increase in their annual electricity bill for 2019.

While the cost of buying electricity for next year on behalf of customers (wholesale electricity) decreased, these savings were cancelled-out by an increase in the cost of government green schemes, regulatory-approved network tariffs and Victorian government regulatory costs.
The total cost of federal government green schemes for an average EnergyAustralia Victorian residential customer is now around $105 a year. The federal government’s small-scale renewable energy scheme (SRES), which provides subsidies for solar systems, represents about $55 of an average Victorian household’s electricity bill, up more than 60 per cent from a year ago.

Secure Saver available to offset gas price rise

The average annual residential gas bill for EnergyAustralia’s Victorian customers will increase 4.2 per cent for 2019, or by around $69. The rise reflects the higher cost of buying and transporting gas due to restricted supply in Australia’s east-coast market.

EnergyAustralia Chief Customer Officer Chris Ryan said households could avoid the rise in gas bills, and keep rates for gas, as well as for electricity, flat for next year, by switching to the company’s Secure Saver plan, which for a limited time will allow customers to lock-in 2018 rates for the next two years.

Mr Ryan said Secure Saver was like “hitting the pause button” on some of the cost-of-living pressures people are under and would save the average gas customer around $138 over a two-year benefit period, based on the current price changes.

Reducing cost and complexity for customers across the energy chain

“We know households are feeling the pinch and the last thing anyone wants to hear four weeks before Christmas is that power bills are about to rise again,” Mr Ryan said.

“So, we’re keeping residential electricity prices on hold for 2019 by paying on behalf of customers the increased cost of government green schemes and higher profits for the poles-and-wires networks. We’re also making it possible for customers to avoid the impact of an increase in gas prices with Secure Saver.

“We hope the action we’ve taken will inspire other parts of the energy supply chain to also do their bit to help ease the burden on families,” Mr Ryan said.

Mr Ryan said EnergyAustralia had recently written to Victorian distribution networks asking for assistance in reducing retail electricity prices.

Earlier this month EnergyAustralia announced that from January 2019 it would automatically apply 15 per cent discounts on electricity and gas usage for its eligible concession-card customers (such as pensioners, veterans and healthcare-card holders) on default or “standing offer” tariffs.

Mr Ryan said the closure of the Hazelwood power station in the Latrobe Valley on short notice in 2017 had driven electricity prices to record highs, putting the budgets of Victorian families under real pressure.

He said EnergyAustralia strongly supported reducing cost and complexity for customers by fast-tracking the introduction of a credible comparator rate which allows customers to more easily compare electricity offers across the market, so they can find the right deal for them.

Additionally, Mr Ryan noted SRES was the fastest-growing contributor to residential electricity bills.

“Solar plays an important role in Australia’s transition to cleaner energy, and homes and businesses across the country are putting systems on their roofs in record numbers,” Mr Ryan said.

“That’s great, but with the way this federal government subsidy works now, the majority of Australian homeowners and renters – the ones who don’t have solar – are paying for the minority of households which do. We agree with the ACCC – that’s not right. It’s about fairness.”

Mr Ryan reiterated calls by EnergyAustralia for state governments to relax restrictions on the development of new gas supplies, to ease prices for customers.

-ENDS- 

* Including GST. Impacts are approximate based on average residential customer annual bill.

ENERGYAUSTRALIA CUSTOMER-SUPPORT MEASURES INCLUDE:

• Automatically applying 15 per cent discounts on electricity and gas usage for eligible EnergyAustralia concession-card customers (such as pensioners, veterans and healthcare-card holders) on default or “standing offer” tariffs.
• Paying $40 million of costs to keep average FY2018/19 electricity prices flat for EnergyAustralia customers in New South Wales.
• Investing an additional $10 million in measures to support financially vulnerable customers, including waiving $1.8 million of energy debts for around 1,000 vulnerable customers.
• Ensuring all customers enrolled in the EnergyAustralia hardship program and on a default tariff will pay a rate equivalent to the company’s best generally-available post-discount price i.e. no EnergyAustralia hardship program customer will pay standing offer tariffs for their electricity or gas.
• Removing fees for paper bills and over-the-counter transactions for all customers in New South Wales, Victoria, South Australia and Queensland.
• Writing in the past year to all EnergyAustralia customers on default rates advising them that there are better offers available.
• Introducing Secure Saver, a product which provides customers with certainty by fixing their electricity and gas rates for two years.