New guide to the Victorian energy market

The Essential Services Commission today released its first comprehensive report on the Victorian Energy Market.

The report which covers the 2015-16 financial year includes information on energy prices, the compliance and performance of energy companies, and customer protections. The report is written from a customer’s perspective.

Commission Chairperson, Dr Ron Ben-David said the Report aims to help customers navigate their way through the increasingly complex Victorian energy market.

‘The electricity and gas that Victorians use hasn’t changed, but customers must now carefully choose from a complex array of offers, contracts and discounts.

While Victoria now has broad consumer protections for energy customers, as a result of new legislation introduced earlier in the year, Dr Ben-David said the report highlighted that customers need to be extremely vigilant in reading the fine print before signing a contract.

“Customers who breach conditions in their energy contract, particularly relating to pay-on-time discounts, can end up paying substantially more than they might have expected,” Dr Ben-David said.

The report, which includes information about Victoria’s 29 electricity retailers, 11 gas retailers and 5 distribution businesses found:

• Many energy contracts now provide larger discounts than ever before but those discounts are conditional on customers meeting all relevant conditions
• The price of unconditional electricity and gas contracts increased by seven and nine per cent respectively, while conditional electricity contracts remained unchanged, and conditional gas contracts increased by four per cent
• Almost 70,000 customers participated in retailers’ hardship programs, an increase of 30 per cent year-on-year, however customer debt in those programs increased, with the average debt of customers in hardship programs increasing by 21 per cent to $1,422
• The total number of customers disconnected from their energy supply for non-payment remained largely unchanged at 61,529
• The number of customer complaints to electricity and gas retailers remained steady at 340,000.

The report also reinforces the Commission’s findings in its recent inquiry into the framework for helping customers facing payment difficulties.

‘Assistance often comes too late and it does not seem to be effective at limiting debt or helping people avoid disconnection’. Dr Ben-David said.