Australians Buckling Under Power Bill Strain

The Australian Energy Regulator’s annual report on the performance of the retail energy market shows many households and businesses struggling to pay their bills.

Average debt levels (90 days or more) in South Australia, the ACT and Tasmania were between $700 and $800 for electricity and approximately $500 in the ACT and $265 in South Australia for gas.

In South Australia at the end of June 2013, around 40,000 electricity customers (just over 5 per cent) had amounts owing to their retailer for 90 days or more, with the average outstanding amount beingĀ  around $700. Many small SA businesses are also struggling to pay their bills, with 6% in South Australia having an average debt of $1,453.

More than 5,300 SA homes had their power disconnected for non-payment in the first half of 2013.

The report reveals electricity charges are highest in South Australia (annual bill of $2335) followed by Tasmania ($2166), then Victoria and New South Wales
($1960) and the ACT ($1511).

Customer churn is still a major feature of the Australian electricity market. While customers switching between retailers in South Australia and the ACT remained steady, the rate picked up in New South Wales and Victoria, but decreased slightly in Queensland.

It’s been said elsewhere that if retailers spent more effort and money on retaining customers, they could reduce the amount they needed to spend in acquiring new ones, with the latter being the more resource intensive than the former. The case in SA perhaps proves the point – all but three retailers in the state have reported their failure to meet South Australian service standards for responding to written inquiries and telephone calls.

It would also seem many households may still be unaware of the savings to be realised by going solar. Innovative financing solutions are also available that remove the up-front cost barrier. These include Energy Matters’ $0 deposit, Save As You Go initiative whereby repayment levels on solar power systems can be less than what would be paid for the equivalent electricity sourced from the mains grid.

The full Australian Energy Regulator’s report can be viewed here (PDF).