Australians are paying up to 43 per cent profits to electricity companies, who are failing to deliver low prices to consumers, to the point that the Government may need to step in and re-regulate the power industry.
Over the last 10 years, the cost of electricity has almost doubled in Melbourne, Sydney, Brisbane and Adelaide.
In Victoria specifically, electricity providers enjoy a profit margin of around 13 per cent, which is more than double the margin traditionally considered fair.
If fairer prices were to be set, Victorians could save around $100 per household per year.
The Grattan Institute’s Price shock: Is the retail electricity market failing consumers? report revealed that there are still better deals available on electricity. However, the market is too complicated, so rather than find a better arrangement, many Australians simply pay more for power than necessary.
This means that competition among electricity providers is dwindling and, as a result, promised innovations in customer service and technology, such as smart meters and bundling solar power and battery-storage systems are also falling by the wayside.
The report suggests that it may be time for the Government steps to act and ensure that customers get fairer prices and better service.
Sure, it may be time for the Government to step in and protect us from overpaying for electricity. But really, the power is already in our hands; we just have to take them out from under our bums and make electricity providers more accountable.
And yes, the market is confusing, but all it needs is a little research to understand and then for us to take advantage of comparison tools, such as:
Now, find the best deal and play the power companies off against each other. The only way they will offer fairer prices, better deals and innovative solutions, is if they are forced to do so.
Right now, they’re sitting pretty. If we do an annual comparison and switch providers for a better deal, we will improve market competition.
It also goes without saying that the decision to deregulate the industry has done us no favours. It may well be time for the Government to act and re-regulate power prices.
But, so far, all we’ve heard is the standard rhetoric: “we’ll fix their mess” and “we’ll ensure that electricity is affordable and reliable for households and business”.
Australians are tired of being gouged. It would be nice to see if our government does more to ensure that we get a fairer deal, rather than continue to line the pockets of power companies owned by multi-national interests who pay little to no tax on these exorbitant profits.
In the meantime, the power, so to speak, is in our own hands.
Do you think you pay too much for electricity? Have you ever sourced a better deal on electricity costs? Do you use electricity comparison sites? If you have solar power and battery backup, do you find that your power bills are more manageable?