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From the CEO
Another month has passed and as restrictions ease due to low levels of transmission in our communities, we are beginning to establish a “new normal” while maintaining hygiene and distancing practices.
We cannot forget however that many Australians are continuing to do it tough, with the impact of the pandemic coming on top of drought or bushfires in many areas.
We have some insight into just how hard it is thanks to the Australian Bureau of Statistics (ABS), who are collecting information on the effects of COVID-19. For example, almost one third of Australians (31%) in the survey said that their household finances had worsened due to COVID-19 in the period mid-March to mid-April.[1] Over the seven weeks from mid-March to early May, total payroll jobs lost stands at 7.3%, increasing the overall level of unemployment across the country. [2] The ABS data also reveals the extraordinary hit to business, with nearly 70% facing a loss in income and more than 40% expecting a reduced ability to pay operating expenses.[3]
Just as the focus on restoring the economy has resulted in extraordinary responses to exceptional circumstances, we cannot be complacent about the fact that Australian families may be facing serious cost-of-living pressures. We know that for those who are working from home and home-schooling children - throughout autumn and going into winter - energy use is much higher than normal. The information being reported from businesses whose employees use smart meters is that consumption has risen by 20% on average.
We at Energy Consumers Australia continue to ask difficult questions of government and industry. Are those that need help receiving it? Are there gaps in the system? What advice are we giving people about how to manage their winter bills? Are energy retailers letting those people, who might struggle to pay their next bill, know how they can get help?
We acknowledge that there are positive steps being taken towards making sure no-one has to go without the power they need because they can’t pay their bill. A number of governments around the country have increased the assistance they are making available through bill discounts or rebates and have made them simpler to access.
In another positive step, energy retailers are talking to each other about how they can offer a consistent response to the financial stresses people are facing, subject to conditions imposed under an interim authorisation approved by the Australian Competition and Consumer Commission (ACCC). [4] In terms of what is on offer to help people manage their bills we believe we cannot let the perfect be the enemy of the good.
As well as this, the “poles and wires” electricity businesses in New South Wales, Victoria and South Australia have voluntarily taken a holiday on payments they are owed by the energy retailers, from 1 April to end June 2020, which can constitute around 40-50% of a customer’s bill. It applies to situations where households are in financial stress, and to small businesses who have had a 75% fall in revenue.
The Australian Energy Regulator has sought to have a similar deferral mechanism put in place for 6 months from 1 July 2020 to 31 December 2020.[5] The Australian Energy Market Commission (AEMC) released an Issues Paper on 28 May 2020, and is consulting on the proposed rule change.[6] We have gone on record in supporting this mechanism to defer the network cost pass-through, as it enables energy retailers to “right size” their assistance package to help people who are struggling to pay their bills. [7]
However, for these measures to be effective, people need to know where they can get help. This week the signatories to The Energy Charter launched their We’ve Got You campaign.[8] We have asked that the Australian Government also commit to an awareness campaign so that consumers know that assistance is available if they cannot manage their energy bills.
Now more than ever people need information and tools that work for them in managing the costs of energy in their home and in their business. In May, we launched the website updates around our Power Shift Final Report; the culmination of 3 years of research. This Power Shift research is aimed at helping industry, regulators, community groups and government deliver highly targeted programs and allowing them to find the opportunities to empower consumers.
On a personal note, I haven’t found things slowing down at all since the Energy Consumers Australia team moved to working from home on 20 March 2020. If anything, life seems to have sped up! At work and at home I am finding we are doing more to stay connected and closer as colleagues, as friends, as a family and as a community.
We value our engagement with you, and if you have questions or comments, please connect with us via our social media or reach out through our Share Your Story page here.
Stay safe and well,
Lynne Gallagher
Chief Executive Officer (Interim)
