victorian energy prices january 2016...2 the victorian tariff-tracking project to date, this project...

Victorian Energy Prices January 2016An Update report on the Victorian Tariff-Tracking project

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Disclaimer

Theenergyoffers,tariffsandbillcalculationspresentedinthisreportandassociatedworkbooks shouldbeusedasageneralguideonlyandshouldnotbe reliedupon.The workbooks are not an appropriate substitute for obtaining an offer from anenergyretailer. Theinformationpresentedinthisreportandtheworkbooksisnotprovidedasfinancialadvice.Whilewehavetakengreatcaretoensureaccuracyoftheinformationprovidedinthisreportandtheworkbooks,theyaresuitableforuseonlyasaresearchandadvocacytool.Wedonotacceptanylegalresponsibilityforerrorsorinaccuracies.TheStVincentdePaulSocietyandAlvissConsultingPtyLtddonot accept liability for any action takenbasedon the informationprovided in thisreportortheassociatedworkbooksorforanyloss,economicorotherwise,sufferedas a result of reliance on the information presented. If you would like to obtaininformationaboutenergyoffersavailabletoyouasacustomer,gototheVictorianGovernment’s comparison website switchon.vic.gov.au or contact the energyretailersdirectly.VictorianEnergyPricesJanuary2016

AnupdatereportontheVictorianTariff-TrackingProject

MayMausethJohnston,February2016

AlvissConsultingPtyLtd

©StVincentdePaulSocietyandAlvissConsultingPtyLtd

Thisworkiscopyright.ApartfromanyusepermittedundertheCopyrightAct1968(Ctw),nopartsmaybeadapted,reproduced,copied,stored,distributed,publishedorputtocommercialusewithoutpriorwrittenpermissionfromtheStVincentdePaulSociety.Contact:GavinDufty

Manager,SocialPolicyUnitVictoriaStVincentdePaulSocietyPhone:(03)98955816or0439357129

Coverphoto:KimWalvisch(@sublurbonInstagram)

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TheVictorianTariff-TrackingProject

Todate,thisprojecthastrackedelectricityandgastariffsinVictoriafromJuly2008(retail price deregulation took effect on January 1 2009) to January 2016, anddevelopedaspreadsheetbasedtoolthatallowsconsumeradvocatestobuildontheinitialanalysisandcontinuetotrackchangesastheyoccur.WehavedevelopedfourworkbooksthatallowtheusertoenterconsumptionlevelsandanalysehouseholdbillsforgasandelectricitystandingoffersfromJuly2008toJanuary2016,aswellaspublishedelectricityandgasmarketoffersasofJuly2010andJanuary2016.Workbook1:ElectricitystandingoffersJuly2008-January2016Workbook2:GasstandingoffersJuly2008-January2016Workbook3:ElectricitymarketoffersJuly2010toJanuary2016Workbook4:GasmarketoffersJuly2010toJanuary2016The four workbooks can be accessed at the St Vincent de Paul Society Victoria’swebsite:www.vinnies.org.au/energy

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Tableofcontent

TheVictorianTariff-TrackingProject 2

Keyfindings 4

1.Changestothestandingoffers 6

1.1Electricitystandingoffers 6

1.1.1AGL’selectricitystandingoffers 71.1.2Origin’selectricitystandingoffers 91.1.3EnergyAustralia’selectricitystandingoffers 101.2Changestonetworkcharges 12

1.2.1Changestonetworkpricesvs.retailprices 121.3Gasstandingoffers 15

1.3.1AGL’sgasstandingoffers 151.3.2Origin’sgasstandingoffers 161.3.3EnergyAustralia’sgasstandingoffers 17

2.Marketoffers 18

2.1ElectricitymarketoffersJanuary2016 18

2.1.1Potentialsavings-Differencesbetweenelectricityoffers 19Citipower 20

Powercor 23

SPAusnet 25

Jemena 27

UnitedEnergy 29

2.2GasmarketoffersJanuary2016 31

2.2.1Potentialsavings-Differencesbetweengasoffers 32OriginMetro 32

AGLSouth 33

OriginNorth 35

TruEast 36

OriginSouthEast 37

TruWest 39

AGLNorth 40

TruCentral 41

2.3Marketofferprices–monthbymonth 43

2.3.1Incumbents’electricitymarketoffersJuly2015toJanuary2016 432.3.2Incumbents’gasmarketoffersJuly2015toJanuary2016 452.4Discounting 47

3.Changestothesupplycharge 49

3.1Electricitysupplycharge 49

3.2Gassupplycharge 52

4.Totalcostofenergyandpricechangesbyarea 54

4.1Innercity,innerNorthandEasternsuburbs 57

4.2InnerWest,outerNorthandNorthWesternsuburbs 58

4.3SouthEasternsuburbsandMorningtonPeninsula 59

4.4OuterWesternsuburbsandWesternVictoria 60

4.5OuterNorthEasternsuburbsandEasternVictoria 61

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Keyfindings

• Manyelectricityconsumerswillreceivepricedecreases inJanuary/February2016whilemostgasconsumerswillexperienceapriceincrease.

• Householdswith typical electricity consumption (4800kWh) can save up to

$610-$830perannum(dependingontheirnetworkarea)ifswitchingfromtheworststandingoffertothebestmarketoffer.1

• Theprice-spread,e.gthedifferencebetweenthebestandtheworstmarket

offers, range from $480 per annum (in Citipower’s area) to $580 (in SPAusnet’sarea)forcustomerswithtypicalconsumptionlevels.2

• The regulated electricity network and smart meter charges reduced

significantly in January 2016 but only one retailer of the three incumbents(AGL)appearstohavepassedthesesavingontoconsumersinfull.

• Gas customerswith typical consumption (63,000Mj) can save up to $400 -$600perannum (dependingon their gas zone) if switching from theworststandingoffertothebestmarketoffer.3

• Forgas,theprice-spreadformarketoffersrangesfrom$160perannum(Tru

Central gas zone) to $320 (Tru East gas zone) for customers with typicalconsumptionlevels.4

• Forelectricity,Powershop (inCitipowerand Jemena’snetworks), Simply (in

PowercorandUnitedEnergy)andDodo(inSPAusnet)havethebestpricedmarket offers as of January 2016. QEnergy’s market offers are the mostexpensiveinallnetworkareas.5

• Forgas,AGLoffersthebeststand-alonegasmarketofferinfiveoutofeight

gaszones,whileOriginisthemostexpensiveinfivegaszones.6

• The electricity supply charge has increased in some network areas anddecreased in others. In Citipower and Powercor’s areas, all of the three

1Basedontheworstoftheretailers’standingoffer(singlerate)andthebestofthepublishedmarketoffers(includingadditionaldiscountsand/orpayontimediscounts).2Householdsusing4800kWhperannum(singlerate)andallmarketofferbillsincludeadditionaldiscountsand/orpayontimediscounts.3Basedontheworstoftheretailers’standingofferandthebestofthepublishedmarketoffers(includingadditionaldiscountsand/orpayontimediscounts).4Householdsusing63,000Mjperannum.Allmarketofferbillsincludeadditionaldiscountsand/orpayontimediscounts.5Basedonsinglerateandanannualconsumptionof4,800kWh/annum.Includesdiscountsandpayontimediscounts.6Basedonannualconsumptionof63,000Mj/annumandincludesdiscountsandpayontimediscounts.Retailersthatonlyoffergasinconjunctionwithelectricity(dualfuel)arenotincludedinthiscomparison.

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incumbent retailers have higher electricity supply charges in January 2016compared to one year ago. In SP Ausnet, Jemena and United Energy’snetwork areas, all of the incumbent retailers have reduced their supplycharge.However,thesizeoftheincreases,anddecreases,variessignificantlybetweentheretailersaswellasnetworkareas.

• The gas supply charge has increased in most gas zones. Out of the three

incumbents’standingoffers,AGLhasthesinglehighestgassupplychargeofapproximately$300perannum(intheAGLNorthgaszone).

• Dual fuelhouseholdswithanaverageconsumptionofelectricityandgas in

Melbourne (CBD), inner north, east and south will typically receive anincreaseinenergycostsof$100-$125comparedtolastyear.7Inotherareas,increasestothecombinedenergycostfordualfuelhouseholdswillbelowerduetolowerelectricityprices.

7ThesearehouseholdsinCitipower’selectricitydistributionnetworkandEnvestra’sTRUEastgaszoneorMultinet’sOriginMetro/AGLSouthzones.

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1.Changestothestandingoffers8

• All of the three incumbent retailers (AGL, Origin and Energy Australia)gazettednewstandingoffers(electricityandgas)thathaveresultedinpricechangestakingeffectinlateJanuary/earlyFebruary2016.9

• Astheregulatednetworkcharges,aswellasthesmartmetercharges,werereducedfrom1January2016,manycustomerswillreceivepricereductions.However, the sizeof thedecreases varies significantly between retailers aswellasdistributionnetworks.

• Of the three incumbent retailers, AGL has the greatest standing offerdecreases in January2016ofapproximately5%(dependingonthenetworkarea).AGL’sstandingoffercustomersinJemenaandUnitedEnergy’snetworkareaswillreceivepricereductionsof5.2%and4.4%respectively.

• Average consumption households (4,800kWh/annum) on AGL’s standing

offerwillsavebetween$30and$145perannum(dependingonthenetworkarea).Origin customers inCitipower’snetworkareawill experiencea slightincrease($35perannum),whilecustomersinotherareaswillsavebetween$60 and $95. Customers on Energy Australia’s standing offer will savebetween$15and$65perannum.10

• Unlikeelectricity,mostgasconsumerswillexperiencepriceincreasesin

January2016.

• AGLhasincreaseditsgasrateby5-7%(dependingonthegaszone),Originby5-13.5%andEnergyAustraliaby1.5-10%.

1.1Electricitystandingoffers

ThissectionanalyseschangestotheelectricitystandingoffersfromJanuary2015toJanuary 2016 by network area.11 There are five network businesses in Victoria:Powercor and SP Ausnet distributing electricity to rural and regional Victoria andCitipower,JemenaandUnitedEnergy.

8Calculationsbasedontheincumbentretailer’ssingleratestandingofferandahouseholdconsumptionof4800kWhperannum.InPowercorandSPAusnet’sarea,secondcalculationisbasedonhouseholdconsumptionof7000kWhperannum(30%off-peak)attherateoftheincumbentretailer’sstandingofferforthecontrolledloadtariff.Forgas,calculationsbasedontheincumbentretailer’sstandingofferandahouseholdconsumptionof63,000Mjperannum.9AGL’snewstandingofferstookeffecton18JanuarywhileOriginandEnergyAustralia’sofferstookeffect1February.10Allbillcalculationsbasedonhouseholdsconsuming4,800kWhperannum,singlerate.11Whileretailerscanchangetheirstandingofferpriceseverysixmonths,noneoftheincumbentretailersamendedtheirpricesinJune/July2015.

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As in the previous Tariff-Tracking reports, the bill calculations in this report haveassumed an average consumption of 4800kWh per annum for households on thesinglerate.12 Thesearegenerallyhouseholdsconnectedtomainsgasandthereforehavealowerconsumptionthanall-electrichouseholds.Forall-electrichouseholds,which are predominantly in rural areas, the bill calculations have assumed anaverageconsumptionof7000kWhperannum.Theratesusedinthecalculationsarethose for the controlled loadoffers anda splitof70%peakand30%off-peakhasbeenassumed.

1.1.1AGL’selectricitystandingoffers

Chart1belowshowsthat:

• Average consumptionhouseholdsonAGL’s standingofferwill experienceadecreaseof$30-$145 inannualelectricitycostsasof January2016.Thesearedecreasesofapproximately:

o $30foraverageconsumptionhouseholdsinCitipower’sareao $130foraverageconsumptionhouseholdsinPowercor’sareao $145foraverageconsumptionhouseholdsinSPAusnet’sareao $95foraverageconsumptionhouseholdsinJemena’sareao $75foraverageconsumptionhouseholdsinUnitedEnergy’sarea

• AnnualAGLbillsarenow2–7.5%lowerthantheywereinJanuary2015.The

greatestreductionbeinginSPAusnet’sareaandthelowestinCitipower.

• AGLcustomersinPowercorandSPAusnet’sareas,whichcoverallofcountryVictoria, are receiving greater price reductions than customers in othernetworkareas.

AGLalso introducedanadditional10%offstandingofferusagerateforconcessioncardholdersasof1January2016.13ThisdiscountisappliedautomaticallybyAGLbutas it does not affect all standing offer customers it is not included in the billcalculationspresentedinthisreport.

12Consumptionlevelsdovarybetweennetworkareasbutwebelieve4800kWhand7000kWhperannumareappropriatebenchmarkstoanalysetariffchangesandbillimpactsforVictorianhouseholds.13AGL,AGLannouncesadditionalsupportforvulnerablecustomers,MediaRelease,9July2015athttps://www.agl.com.au/about-agl/media-centre/article-list/2015/july/agl-announces-additional-support-for-vulnerable-customers

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Chart1ChangestoAGL’sstandingoffers(asannualbills,incGST)fromJanuary2015toJanuary2016-Calculationsbasedonsingleratetariffandannualconsumptionof4800kWh


• The annual bill for all electric households (with average consumption) onAGL’s standing offers in Powercor and SP Ausnet’s areas is nowapproximately$130-$170lessthaninJanuary2015.

Chart2ChangestoAGL’sstandingoffers(asannualbills,incGST)fromJanuary2015toJanuary2016-Calculationsbasedontworate-ratetariffandannualconsumptionof7000kWh(30%off-peak)

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1.1.2Origin’selectricitystandingoffers


• AverageconsumptionhouseholdsonOrigin’sstandingofferintheCitipowerarea will experience an increase of $35 in annual electricity costs as ofJanuary 2016. Customers in other network areas will receive pricereductions.Thesearedecreasesofapproximately:

o $70foraverageconsumptionhouseholdsinPowercor’sareao $95foraverageconsumptionhouseholdsinSPAusnet’sareao $90foraverageconsumptionhouseholdsinJemena’sareao $60foraverageconsumptionhouseholdsinUnitedEnergy’sarea

• ThebillincreaseinCitipower’sareaisapproximately2%whileOrigin

billsinothernetworkareasarenow3.5–5%lowerthantheywereinJanuary 2015. The greatest reduction being in SP Ausnet andJemena’snetworkareas

Chart3ChangestoOrigin’sstandingoffers(asannualbills,incGST)fromJanuary2015toJanuary2016-Calculationsbasedonsingleratetariffandannualconsumptionof4800kWh


• The annual bill for all electric households (with average consumption) onOrigin’s standing offers in Powercor and SP Ausnet’s areas is nowapproximately$30-$55lessthaninJanuary2015.

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Chart4ChangestoOrigin’sstandingoffers(asannualbills,incGST)fromJanuary2015toJanuary2016-Calculationsbasedontworate-ratetariffandannualconsumptionof7000kWh(30%off-peak)

1.1.3EnergyAustralia’selectricitystandingoffers


• Average consumption households on Energy Australia’s standing offer willexperienceadecreaseof$15 -$65 inannualelectricity costsasof January2015.Thesearedecreasesofapproximately:

o $15foraverageconsumptionhouseholdsinCitipower’sareao $45foraverageconsumptionhouseholdsinPowercor’sareao $65foraverageconsumptionhouseholdsinSPAusnet’sareao $35foraverageconsumptionhouseholdsinJemena’sareao $15foraverageconsumptionhouseholdsinUnitedEnergy’sarea

• Annual Energy Australia bills are now 1 – 3.5% lower than they were inJanuary2015.ThegreatestreductionbeinginSPAusnet’sarea.

1,700

1,800

1,900

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2,200

2,300

2,400

2,500

2,600

Powercor Ausnet

$perannum

Networkareas

Jan'15

Jan'16

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Chart5ChangestoEnergyAustralia’sstandingoffers(asannualbills, incGST)fromJanuary2015toJanuary2016-Calculationsbasedonsingleratetariffandannualconsumptionof4800kWh

Chart6belowshowsthat:• The annual bill for all electric households (with average consumption) on

EnergyAustralia’sstandingoffers inPowercorandSPAusnet’sareas isnowapproximately$50-$115lessthaninJanuary2015.

Chart6ChangestoEnergyAustralia’sstandingoffers(asannualbills,incGST)fromJanuary2015toJanuary2016-Calculationsbasedontworate-ratetariffandannualconsumptionof7000kWh(30%off-peak)

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Powercor Ausnet

$perannum

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Jan'16

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1.2Changestonetworkprices

On 1 January 2015 newnetwork charges took effect and retailers typically reflectthesechangesintheirprices.Chart7belowshowsthechangestonetworkchargesfor household bills consuming 4800 kWh per annum.14 Consistent with the retailprices discussed above, the only network with an increase to network charges isCitipower’snetworkarea (1%). InPowercor’sareas, thenetworkchargedecreasedby14%andthisdecreasewasalsoreflectedinretailprices.Smartmeter charges thatallow thenetworks to recover costsassociatedwith theVictoriangovernmentmandatedsmartmeterroll-out,areseparatetothestandardnetworkcharges.Theregulatedsmartmeterchargesdecreasedsignificantlyin2016and the cuts to the smartmeter charges are larger than the cut to the standardnetworkchargeinallareasexceptPowercor.TheAERhasestimatedthatthelowerregulated metering cost alone should reduce annual electricity bills byapproximately:

• $24inCitipower’snetworkarea(whereOriginistheincumbent)• $14inPowercor’snetworkarea(whereOriginistheincumbent)• $96inSPAusnet’snetworkarea(whereEnergyAustraliaistheincumbent)• $89inJemena’snetworkarea(whereAGListheincumbent)• $63inUnitedEnergy’snetworkarea(whereAGListheincumbent)15

Chart7showschangestothestandardnetworkcharges(notincludingsmartmetercharges)foreachofthenetworkareas.

14BasedonNetworkUseofSystemCharges(NUOS)forsingleratetariffs.15AER,LowernetworkchargesforVictorianelectricitycustomersin2016,Mediarelease,16December2015athttps://www.aer.gov.au/news-release/lower-network-charges-for-victorian-electricity-customers-in-2016

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Chart 7 Changes to standard network charges from January 2016 - Calculations based on annualnetworkcostsforhouseholdsonasingleratetariffconsuming4800kWh

1.2.1Changestonetworkpricesvs.retailprices

The retailers absorb these reductions in network costs and customers rely onretailerstopassthesesavingsoninordertobenefit.

Chart8belowshowstheestimatedreduction intotalnetworkcosts(meteringandNUOS)compared to the incumbent retailers’decreases/increases tostandingoffercharges. It shows thatonlyAGLappears tohavepassedon these savings in full inmost network areas. Origin has only passed on these savings in Jemena and SpAusnet’sareasandactuallyincreaseditspricesintheCitipowernetwork(whereitisthe incumbent). Energy Australia’s price reductions fall short in all network areasapartfrominCitipower’sarea.Whileothercostsmayimpactonthepricesretailersoffertheircustomers,wenotethere is significant discrepancies between the reduction in regulated networkchargesandthereduction in retailprices.EnergyAustralia takesawindfallgainof$37foreach(averageconsumption)householdontheirstandingofferinSPAusnet’sarea and Origin gains $55 and $22 from their customers in the Citipower andPowercornetworksrespectively.

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Chart8Changestoannualnetworkcosts(includingmeteringcosts)fromJanuary2016comparedtochangesinannualretailbills-Calculationsbasedonhouseholdsconsuming4800kWh,singlerate

Onaverage,acrossallnetworkareas,thethree incumbentsreducedtheirstandingofferpricesby2-5%.However,onlyEnergyAustraliaappliedtheirlargestdecreaseinthenetworkwheretheyhavemostoftheirstandingoffercustomers(SPAusnet).16Table 1below shows the incumbent retailers’ reductions (%) in their own “patch”(networkarea)comparedtoreductionsinothernetworkareas.AGL’s“patch”coversJemena and United Energy’s network areas (blue), Origin’s covers Citipower andPowercor(red)andEnergyAustralia’s“patch”istheSPAusnetnetwork(green).Table 1 Changes to electricity standing offers in January 2016 showing differences between theincumbentretailers’‘patch’andotherareasNetwork AGL

Origin EnergyAustralia

Citipower -1.9 2.2 -1.1 Powercor -7.1 -3.8 -2.5 SPAusnet -7.4 -4.9 -3.4 Jemena -5.2 -4.9 -2.0 UnitedEnergy -4.4 -3.4 -0.8 Retaileraverage(allnetworkareas) -5.2 -3 -2 Retaileraverageforownpatch -4.8 -0.8 -3.4

16Approximately40,000householdsareonEnergyAustralia’sstandingofferandthemajorityofthesehouseholdsarelocatedinSPAusnet’snetworkarea.Themajorityofthe80,000householdsonOrigin’sstandingofferareinCitipowerandPowercor’sareasandthe80,000onAGL’sstandingofferareinJemenaandUnitedEnergy’snetworkareas.NumberofstandingoffercustomersbasedonESC,EnergyRetailersComparativePerformanceReport–Pricing,January2016,table3.15

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1.3Gasstandingoffers

There are three gas distributors and eight main gas zones. The distributors areMultinet,EnvestraandSPAusnetandthegaszonesare:OriginMetro,AGLSouth,OriginNorth, TRUEast,Origin South East, TRUWest, AGLNorth and TRUCentral.The names of the gas zones derive fromwhen AGL, Origin and TRUwere energyretailerswithdesignatedareas.Thesethreeretailersarenotdistributionbusinessesand they are not involved in setting the distribution charges in these areas. Thecompanies’ names aremerely used as a descriptor for the various gas zones thatMultinet,EnvestraandSPAusnetdistributegasto.Therearealsosomesmallerruralzones(suchasMildura)thatarenotincludedintheTariff-Trackingtool.

Chart9belowshowsthatgaspriceshaveincreasedacrossallgaszones.Theannualbill foranaverageconsumptionhousehold (63,000Mjperannum)willbebetween1.5–13.5%higher,dependingonthegaszoneandretailer,thanlastyear.

Chart9Estimatedchanges(%)toannualbillsforstandingoffercustomerswithaverageconsumption(63,000MJperannum)fromJanuary2015toJanuary2016

1.3.1AGL’sgasstandingoffers

Chart10belowshowsthataverageconsumptionhouseholdsonAGL’sstandingofferwillexperienceannualpriceincreasesfrom$65(TruWestgaszone)to$105(OriginMetroandAGLGaszones)asofJanuary2016.Thisisequivalenttoa5–8%increasetotheannualbill.

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Percentagechange(%)

AGL Origin EA

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Chart10ChangestoAGL’sgasstandingoffers(asannualbills,incGST)fromJanuary2015toJanuary2016-Calculationsbasedonannualconsumptionof63,000Mj

1.3.2Origin’sgasstandingoffers

Chart 11 below shows that average consumption households onOrigin’s standingofferwillexperienceannualpriceincreasesfrom$65(AGLNorthandTruCentralgaszones) to $180 (Tru East gas zone) as of January 2016. This is equivalent to a 5 –13.5%increasetotheannualbill.Chart11ChangestoOrigin’sgasstandingoffers(asannualbills,incGST)fromJanuary2015toJanuary2016-Calculationsbasedonannualconsumptionof63,000Mj

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1.3.3EnergyAustralia’sgasstandingoffers

Chart12belowshows thataverageconsumptionhouseholdsonEnergyAustralia’sstandingofferwillexperienceannualpriceincreasesfrom$25(TruCentralgaszone)to$140(AGLNorthgaszone)asofJanuary2016.This isequivalenttoa1.5–10%increasetotheannualbill.

Chart12ChangestoEnergyAustralia’sgasstandingoffers(asannualbills,incGST)fromJanuary2015toJanuary2016-Calculationsbasedonannualconsumptionof63,000Mj

Onaverage,acrossallgaszones,thethreeincumbentsincreasedtheirstandingofferprices by 6-8%. In contrast to the electricity changes, there is no pattern showingretailersapplyinghigherincreasestocustomersintheirown“patch”.Table2belowshows the incumbent retailers’ reductions (%) in their own “patch” compared toreductions in other gas zones. AGL’s increases are slightly higher in their own“patch” (blue) compared to overall increases, while both Origin (red) and EnergyAustralia(green)havelowerincreasesintheirown“patch”comparedtotheiroverallincreases.

Table2ChangestogasstandingoffersinJanuary2016showingdifferencesbetweentheincumbentretailers’‘patch’andotherareasGasZones AGL

Origin EnergyAustralia

OriginMetro 7.6 8.6 6.6 AGLSouth 7.8 13.4 7.9 OriginNorth 7.4 7 4.2 TruEast 5.1 13.4 6.6 OriginSouthEast 7.5 7.6 5.7 TruWest 4.8 5.3 3.1 AGLNorth 7.3 4.6 9.8 TruCentral 7.1 4.6 1.5 Retaileraverage(allgaszones) 6.8 8.1 5.7 Retaileraverageforownpatch 7.5 7.7 3.7

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1,600

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Jul'15

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2.Marketoffers

The price-spread, or the difference between the bestmarket offer and theworststanding offer (as well as the differences between market offers), will changesomewhatthroughouttheyear. Firstly,retailersmaychangethemarketofferrateat any time (althoughcustomersmust receivenotification). Secondly, retailersdonotgazettenewstandingoffersattheexactsametime,butwhenaretailergazettesnewstandingoffers,changestomarketoffersusuallyfollow.17

2.1ElectricitymarketoffersJanuary201618

• Typicalconsumptionhouseholds(4800kWh)cansave$610-$830perannum

(dependingontheirnetworkarea)ifswitchingfromtheworststandingoffertothebestmarketoffer.19

• The greatest potential annual saving is in SP Ausnet’s network area(approximately$835).20

• The difference between the best and the worst market offers range from

$480 per annum (in Citipower’s area) to $580 (in SP Ausnet’s area) forcustomerswithtypicalconsumptionlevels.21

Table 3 below shows additional discounts applicable to the electricity retailers’publishedmarketofferrates.Someoftheretailershavemultiplemarketoffersandmay offer higher (or lower) discounts than those listed here. However, if thediscountishigherthelengthofthecontracttermistypicallylonger.Inothercases,thediscountmightbehigherbutthecustomermustagreetopaybydirectdebit.22 17AMinisterialOrderissuedon21December2015hasamendedthisapproach.Retailersthatdidnotgazettenewpricespriorto27January2016cannotchangetheirpricesuntilthenextsetgazettedate(3June2016).See VictorianGovernmentGazetteNo.S434,23December2015 18Themarketofferswerecollectedbetweenthe2ndandthe20thofJanuary2016anditshouldbenotedthatretailersmaychangetheirratesatanytime.19Basedontheworstoftheretailers’standingoffer(singlerate)andthebestofthepublishedmarketoffers(includingadditionaldiscountsand/orpayontimediscounts).20Ibid.21Householdsusing4800kWhperannum(singlerate)andallmarketofferbillsincludeadditionaldiscountsand/orpayontimediscounts.22Momentum,forexample,hasintroducedadirectdebitdiscountwherecustomersreceivea2%discountoffthemarketofferelectricityrates(theirSmilePowerproduct).Thisdiscountisnotincludedinthebillcalculationspresentedinthisreport.

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Table3ElectricitymarketofferfeaturespostJanuary201623Retailer Guaranteed

discountsFixedterm/Benefitperiod

EarlyTerminationFee

Payontimediscounts

Other(bonuses,incentives)

AGL No 1year No 26%offusage YesOrigin No 1year No 26%offusage YesEnergyAustralia No 1year No 29%offusage YesPowershop No No No 12%offbill^ YesClick No No No 15%offbill YesPowerdirect No 2years No 30%offusage YesRed No No No 10%offbill YesSimply 27%offbill 2years No No YesLumo No 2years No 27%offbill YesQEnergy No 1year $20 No NoMomentum No 1year No No NoDodo No No No 30%offusage NoAlinta No 2years No 35%offusage NoPeopleEnergy No 2years No 30%offusage NoCovau No 1year Yes^^ 30%offusage YesSumo No 2years No 27%offusage NoDiamond No 1year $22 3%offusage YesOnline No 2years No 30%offusage NoCommander No No No 20%offusage Yes

^Powershop’sdiscountisconditionaluponthecustomerregularlypurchasingtheirOnlineSaverproduct.^^Covau’spriceandproductinformationstatementandcancellationformdonotstipulatetheamountchargedforearlytermination

2.1.1Potentialsavings-Differencesbetweenelectricityoffers

Typical consumption households (4,800kWh per annum) on the worst standingoffers can save $610 - $830 per annum if switching to the best publishedmarketoffer(dependingontheirnetworkarea).24Thedifferencebetweentheworstandthebestmarket offers is also significant. Customers on the bestmarket offerwill payapproximately $480 - $580 less per annum compared to customers on the worstmarket offer. It should be stressed that the majority of these discounts areconditional on bills being paid on time and householdswith cash-flow issues thusmay find themselvesunable toachieve theannualbills estimated for someof thebestoffersincludedinthechartsbelow.Furthermore, the big price-spread reflects the significant difference between theworstand thebest retailoffers ineachnetworkarea. Ifweexclude theseoutliers(the twoworstand the twobestoffers), thedifferencebetween thebestand theworstmarketofferrangesfrom$175perannum(inCitipower’sarea)to$300(inSP

23Thesemarketoffersarefeatureshavebeenpublishedontheretailers’websitesbetweenthe2ndandthe20thofJanuary2016.24Basedonmarketofferbillsthatincludediscountsandpayontimediscounts.

20

Ausnet’sarea).25Chart13belowshows the retailmarketofferprice-spreadwithineachofthefivenetworkareas.Chart13Price-spreadfornineteenelectricitymarketoffersineachnetworkareapostJanuary2016(inclGST),includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)

Charts14-18belowshowannualretailbillsfortypicalconsumption(4,800kWhperannum,singlerate)foreachofthefivenetworkareas.Thebluecolumnstotheleftrepresent the standing offer bill, the red columns are themarket offers includingguaranteeddiscounts(butnotpayontimediscounts)whilethegreencolumnsaremarketofferbillsincludingpayontimediscounts.26Citipower

In Citipower’s area, average consumption households on theworst standing offercansaveapproximately$615perannum if switching to thebestpublishedmarketoffer.Powershop is theretailer thatcurrentlyoffers thebestmarketoffer rates inthisarea.27

25Householdsusing4800kWhperannum(singlerate)andallmarketofferbillsincludeadditionaldiscountsand/orpayontimediscounts.26Discounts(excludingGST)havebeenappliedtoconsumptionand/ortotalbillasperofferslistedintable3.27ThediscountappliedtoPowershop’sofferisestimatedbyPowershopandwillonlybeobtainedifcustomersactively“shop”fordiscounts.

900

1000

1100

1200

1300

1400

1500

1600

1700

1800

1900

2000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

$perannum

Retailoffers

SP

PC

Jen

UE

CP

21

Chart14Citipower’snetworkarea:Estimatedannualbills(inclGST)forelectricitystandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)

The difference between the best and the worst market offer is also significant.Powershop’s offer is approximately $485 less than QEnergy’s market offer postdiscounts (andpayon timediscounts) forhouseholdswith this consumption level.Figure 1 below shows estimated annual bills for market offers post discounts inCitipower’snetworkareaaswell theircurrent rankingcomparedto theirofferssixmonthsago(brackets).

9001,0001,1001,2001,3001,4001,5001,6001,7001,800

RetailoffersinCitipower'sarea

Standing Market(exPOT) Market(incPOT)

22

Figure1Citipower’snetworkarea:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)28

28Thesebillestimatesarebasedonratespublishedontheretailers’websitesbetweenthe2ndandthe20thofJanuary2016anditmustbenotedthatretailersmaychangetheirratesatanytime.Additionaldiscountsforcustomerschoosingtopaybydirectdebitarenotincludedinthesebillcalculations.AsPowershop’sratesvaryfromquartertoquarter,theratesusedtocalculatethePowershopbillisanannualaverageandwehaveassumedflatconsumptionthroughouttheyear.

Powershop $,10941(2)

SimplyEnergy $1,1022(1)

Dodo $1,1473(3)

RedEnergy $1,1574(4)

Alinta $1,1685(10)

Diamond$1,2036(8)

Powerdirect $1,2197(11)

EnergyAustralia$1,2318(5)

SumoPower$1,2539(12)

OriginEnergy $1,26210(9)

AGL $1,26411(14)

Momentum $1,27012(7)

OnlinePower&Gas$1,27713(13)

Commander$1,28314(16)

PeopleEnergy $1,29715(17)

Covau$1,31616(15)

ClickEnergy $1,32117(18)

LumoEnergy $1,32718(6)QEnergy $1,57919(19)

23

Powercor

InPowercor’snetworkarea,averageconsumptionhouseholdsontheworststandingoffer can save approximately $730 per annum if switching to the best publishedmarketoffer.SimplyEnergyistheretailerwiththebestmarketofferrates.Chart15Powercor’snetworkarea:Estimatedannualbills(inclGST)forelectricitystandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)

The difference between the best and the worst market offer is also significant.Simply’sofferisapproximately$490lessthanQEnergy’smarketofferpostdiscounts(and pay on time discounts) for householdswith this consumption level. Figure 2belowshowsestimatedannualbills formarketofferspostdiscounts inPowercor’snetworkareaaswelltheircurrentrankingcomparedtotheirofferssixmonthsago(brackets).

1,0001,1001,2001,3001,4001,5001,6001,7001,8001,9002,0002,100

RetailoffersinPowercor'sarea


24

Figure2Powercor’snetworkarea:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)29




Alinta $1,3343(8)


Powershop $1,3795(4)

AGL $1,3826(13)

Dodo $1,3927(6)

Momentum $1,4028(7)


Diamond$1,43710(11)


Covau$1,44912(15)

LumoEnergy $1,45113(5)SumoPower$1,46514(14)





QEnergy $1,80919(19)

25

SPAusnet

In SP Ausnet’s network area, average consumption households on the worststanding offer can save approximately $835 per annum if switching to the bestpublishedmarketoffer.Dodoistheretailerwiththebestmarketofferratesinthisnetworkarea.Chart16SPAusnet’snetworkarea:Estimatedannualbills(inclGST)forelectricitystandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)

As inothernetworkareas, thedifferencebetween thebestand theworstmarketoffer is significant. Dodo’s offer is approximately $580 less per annum thanQEnergy’smarketofferpostdiscounts (andpayon timediscounts) forhouseholdswiththisconsumptionlevel.Figure3belowshowsestimatedannualbillsformarketoffers post discounts in SP Ausnet’s network area as well their current rankingcomparedtotheirofferssixmonthsago(brackets).

1,1001,2001,3001,4001,5001,6001,7001,8001,9002,0002,1002,2002,300

RetailoffersinSPAusnet'sarea


26

Figure3SPAusnet’snetworkarea:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)30


Dodo $1,4131(1)




AGL $1,4695(13)


Alinta $1,5057(8)


SumoPower$1,5599(9)

Momentum $1,56910(15)

Diamond$1,58111(11)


LumoEnergy $1,61613(5)Powershop $1,61714(14)



Covau$1,72917(18)


QEnergy $1,98919(19)

27

Jemena

InJemena’snetworkarea,averageconsumptionhouseholdsontheworststandingoffer can save approximately $695 per annum if switching to the best publishedmarket offer. Powershop is the retailer with the best market offer rates in thisnetworkarea.31Chart17Jemena’snetworkarea:Estimatedannualbills(inclGST)forelectricitystandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)

The difference between the best and the worst market offer is almost $570 perannum.PowershophasthebestvaluemarketofferratesandQEnergyhastheworst.Figure 4 below shows estimated annual bills for market offers post discounts inJemena’s network area as well their current ranking compared to their offers sixmonthsago(brackets).

31ThediscountappliedtoPowershop’sofferisestimatedbyPowershopandwillonlybeobtainedifcustomersactively“shop”fordiscounts.

9001,0001,1001,2001,3001,4001,5001,6001,7001,8001,9002,0002,100

RetailoffersinJemenea'sarea


28

Figure4Jemena’snetworkarea:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)32







Dodo $1,3876(7)

Alinta $1,3897(14)


Momentum $1,3919(5)

AGL $1,40710(16)

Diamond$1,40811(8)

SumoPower$1,42912(9)

Covau$1,46713(13)


LumoEnergy $1,49415(6)ClickEnergy $1,50916(17)



QEnergy $1,86619(19)

29

UnitedEnergy

In United Energy’s network area, average consumption households on the worststanding offer can save approximately $710 per annum if switching to the bestpublishedmarketoffer.SimplyEnergyistheretailerwiththebestmarketofferratesinthisnetworkareabutitisalsotheretailerwiththeworststandingoffer.Chart18UnitedEnergy’snetworkarea:Estimatedannualbills(inclGST)forelectricitystandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)

As inothernetworkareas, thedifferencebetween thebestand theworstmarketoffer is significant. Simply’s offer is approximately $530 less per annum thanQEnergy’smarketofferpostdiscounts (andpayon timediscounts) forhouseholdswiththisconsumptionlevel.Figure5belowshowsestimatedannualbillsformarketofferspostdiscounts inUnitedEnergy’snetworkareaaswell theircurrentrankingcomparedtotheirofferssixmonthsago(brackets).

9001,0001,1001,2001,3001,4001,5001,6001,7001,8001,9002,0002,100

RetailOffersinUnitedEnergy'sarea


30

Figure5UnitedEnergy’snetworkarea:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)33




Alinta $1,2523(8)




AGL $1,2927(13)

Momentum $1,3158(6)

SumoPower$1,3249(9)

Dodo $1,32510(10)

Diamond$1,33811(11)


Covau$1,34813(16)


LumoEnergy $1,38715(7)ClickEnergy $1,43016(17)



QEnergy $1,74719(19)

31

2.2GasmarketoffersJanuary201634

• Typicalconsumptionhouseholds(63,000Mj)cansave$400-$600perannum

(dependingon theirgas zone) if switching fromtheworst standingoffer tothebestmarketoffer.35

• ThegreatestpotentialsavingsareintheTruEast,OriginSouthEastandtheAGL South gas zones (coveringMelbourne CBD, the northern suburbs, baysidesuburbs,YarraValley,MorningtonPeninsulaandGippsland).36

• The difference between the best and the worst market offers range from

$160 per annum (Tru Central gas zone) to $400 (Tru East gas zone) forcustomerswithtypicalconsumptionlevels.37

As with electricity, additional discounts apply to the gasmarket offer rates. Themajorityofthesediscountsarenowconditionalonthecustomerpayingthebillbythe due date. Table 4 below shows additional discounts applicable to the gasretailers’publishedmarketofferrates.Table4GasmarketofferfeaturespostJanuary201638

Retailer* Guaranteed

discounts

Fixedterm/

benefit

period

Early

Termination

Fee

Payontime

discounts

Other

(bonuses,

incentives)

AGL No 1year No 16%offusage YesOrigin No 1year No 13%offusage YesEnergyAus No 1year No 18%offusage YesMomentum^ No No No No NoSimply^ 17%offbill 2years No No NoLumo^ No 2years No 15%offbill YesRed^ No No No 10%offbill NoAlinta^ No No No 15%offusage NoDodo^ No No No 20%offusage NoClick No No No 14%offbill NoCovau^ No 1year Yes 12%offusage No

^Theseretailersonlyoffergastocustomersthatsignupforelectricity

34Themarketofferswerecollectedbetweenthe2ndandthe20thofJanuary2016anditshouldbenotedthatretailersmaychangetheirratesatanytime.35Basedontheworstoftheretailers’standingofferandthebestofthepublishedmarketoffers(includingadditionaldiscountsand/orpayontimediscounts).36Ibid.37Householdsusing63,000Mjperannum.Allmarketofferbillsincludeadditionaldiscountsand/orpayontimediscounts.38Thesemarketoffersarefeatureshavebeenpublishedontheretailers’websitesbetweenthe2ndandthe20thofJanuary2016.

32

2.2.1Potentialsavings-Differencesbetweengasoffers

Typicalconsumptionhouseholds(63,000Mjperannum)ontheworststandingofferscan save $400 - $600 per annum if switching to the best publishedmarket offer(dependingontheirgaszone).Charts19-26belowshowannualretailbillsfortypicalconsumption(63,000Mjperannum)foreachoftheeightmaingaszones.Thebluecolumnstotheleftrepresentthestandingofferbill, theredcolumnsarethemarketoffers includingguaranteeddiscounts(butnotpayontimediscounts)whilethegreencolumnsaremarketofferbillsincludingpayontimediscounts.39Asonlythreeofthesevenretailersoffergasas a stand alone product figures 6 - 13 below, which rank gas market offersaccording to size of annual bill, do not include retailers that only offer gas inconjunctionwithelectricitycontracts.40OriginMetroGasZone

In the Origin Metro gas zone, average consumption households on the worststanding offer can save approximately $470 per annum if switching to the bestpublishedmarketoffer.Dodoistheretailerwiththebestmarketofferratesinthisgaszone,however,asDodoonlyoffergasinconjunctionwithanelectricitycontractitshouldbenotedthatthebeststandalonegasofferisEnergyAustralia(chart19).

Chart19OriginMetrogaszone:Estimatedannualbills(inclGST)forgasstandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum41

39Basedonmarketofferbillsthatincludediscountsandpayontimediscounts.40Asaretailerwithgoodvaluegasratescanhaveexpensiveelectricityrates(andviceversa),weseektofocusonretailoffersavailabletocustomersindependentlyfromotherproducts.41Discounts(excludingGST)havebeenappliedtoconsumptionand/ortotalbillasperofferslistedinthetable4.

800

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

RetailoffersinOriginMetrogaszone

Standing Market(exPOT) Market(inclPOT)

33

Figure 6 shows estimated annual bills for stand alone gas market offers postdiscounts in the OriginMetro gas zone as well as how they ranked compared tootherretailerssixmonthsago(inbrackets).Thedifferencebetweenthebest(EnergyAustralia)andtheworst(Origin)isapproximately$95perannum.Figure6OriginMetrogaszone:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum42

AGLSouthGasZone

IntheAGLSouthgaszone,averageconsumptionhouseholdsontheworststandingoffer can save approximately $520 per annum if switching to the best publishedmarketoffer.Dodoisagaintheretailerwiththebestmarketofferratesinthisgaszone,however,asDodoonlyoffergas inconjunctionwithanelectricitycontract itshouldagainbenotedthatthebeststandalonegasofferisEnergyAustralia’s(chart20).

42Onlyretailersthatofferstandalonegascontractshavebeenincludedinthisfigure.Thesebillestimatesarebasedonratespublishedontheretailers’websitesbetweenthe2ndandthe20thofJanuary2016anditmustbenotedthatretailersmaychangetheirratesatanytime.

EnergyAustralia $1,227(1)

AGL $1,266(3)



34

Chart20AGLSouthgaszone:Estimatedannualbills(inclGST)forgasstandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mj/annum43

Figure7belowshowsestimatedannualbillsforstandalonegasmarketofferspostdiscountsintheAGLSouthgaszoneaswellashowtheyrankedcomparedtootherretailers six months ago (in brackets). The difference between the best (EnergyAustralia)andtheworst(Origin)isapproximately$95perannum.Figure7AGLSouthgaszone:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum44

43Discounts(excludingGST)havebeenappliedtoconsumptionand/ortotalbillasperofferslistedinthetable4.44Onlyretailersthatofferstandalonegascontractshavebeenincludedinthisfigure.Thesebillestimatesarebasedonratespublishedontheretailers’websitesbetweenthe2ndandthe20thofJanuary2016anditmustbenotedthatretailersmaychangetheirratesatanytime.

800

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

RetailoffersinAGLSouthgaszone



AGL $1,270(3)



35

OriginNorthGasZone

In the Origin North gas zone, average consumption households on the worststanding offer can save approximately $440 per annum if switching to the bestpublishedmarketoffer.Dodoistheretailerwiththebestmarketofferratesinthisgaszone,however,asDodoonlyoffergasinconjunctionwithanelectricitycontractitshouldbenotedthatthebeststandalonegasofferisAGL’s(chart21).Chart21OriginNorthgaszone:Estimatedannualbills(inclGST)forgasstandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum45

Figure8belowshowsestimatedannualbillsforstandalonegasmarketofferspostdiscountsintheOriginNorthgaszoneaswellashowtheyrankedcomparedtootherretailerssixmonthsago(inbrackets).Thedifferencebetweenthebest(AGL)andtheworst(Origin)is$105perannum.

45Discounts(excludingGST)havebeenappliedtoconsumptionand/ortotalbillasperofferslistedinthetable4.

800

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

RetailoffersinOriginNorthgaszone


36

Figure8OriginNorthgaszone:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum46

TruEastGasZone

In the Tru East gas zone, average consumption households on theworst standingoffer can save approximately $610 per annum if switching to the best publishedmarketoffer.Dodoistheretailerwiththebestmarketofferratesinthisgaszone,however,asDodoonlyoffergasinconjunctionwithanelectricitycontractitshouldbenotedthatthebeststandalonegasofferisAGL’s(chart22).Chart22TruEastgaszone:Estimatedannualbills(inclGST)forgasstandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum47

46Onlyretailersthatofferstandalonegascontractshavebeenincludedinthisfigure.Thesebillestimatesarebasedonratespublishedontheretailers’websitesbetweenthe2ndandthe20thofJanuary2016anditmustbenotedthatretailersmaychangetheirratesatanytime.47Discounts(excludingGST)havebeenappliedtoconsumptionand/ortotalbillasperofferslistedinthetable4.

AGL $1,282(1)




900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

1,700

RetailoffersonTruEastgaszone


37

Figure9belowshowsestimatedannualbillsforstandalonegasmarketofferspostdiscounts in theTruEast gas zoneaswell ashow they ranked compared tootherretailerssixmonthsago(inbrackets).Thedifferencebetweenthebest(AGL)andtheworst(Origin)isapproximately$135perannum.

Figure9TruEastgaszone:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum48

OriginSouthEastGasZone

In theOrigin South East gas zone, average consumption households on theworststanding offer can save approximately $550 per annum if switching to the bestpublishedmarketoffer.Dodoisagaintheretailerwiththebestmarketofferratesinthis gas zone, however, as Dodo only offer gas in conjunction with an electricitycontractitshouldagainbenotedthatthebeststandalonegasofferisAGL’s(chart23).


AGL $1,248(1)




38

Chart23OriginSouthEastgaszone:Estimatedannualbills(inclGST)forgasstandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum49

Figure10belowshowsestimatedannualbillsforstandalonegasmarketofferspostdiscountsintheOriginSouthEastgaszoneaswellashowtheyrankedcomparedtootherretailerssixmonthsago(inbrackets).Thedifferencebetweenthebest(AGL)andtheworst(Origin)isapproximately$130perannum.Figure10OriginSouthEastgaszone:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum50


900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

1,700

RetailoffersinOriginSouthEastgaszone


AGL $1,256(1)




39

TruWestGasZone

In theTruWestgas zone,averageconsumptionhouseholdson theworst standingoffer can save approximately $410 per annum if switching to the best publishedmarketoffer.Dodoistheretailerwiththebestmarketofferratesinthisgaszone,however,asDodoonlyoffergasinconjunctionwithanelectricitycontractitshouldbenotedthatthebeststandalonegasofferisAGL’s(chart24).Chart24TruWestgaszone:Estimatedannualbills(inclGST)forgasstandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum51

Figure11belowshowsestimatedannualbillsforstandalonegasmarketofferspostdiscounts intheTruWestgaszoneaswellashowtheyrankedcomparedtootherretailerssixmonthsago(inbrackets).Thedifferencebetweenthebest(AGL)andtheworst(Click)is$40perannum.

51Discounts(excludingGST)havebeenappliedtoconsumptionand/ortotalbillasperofferslistedinthetable4.

800

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

RetailoffersinTruWestgaszone


40

Figure11TruWestgaszone:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum52

AGLNorthGasZone

IntheAGLNorthgaszone,averageconsumptionhouseholdsontheworststandingoffer can save approximately $490 per annum if switching to the best publishedmarketoffer.Dodoistheretailerwiththebestmarketofferratesinthisgaszone,however,asDodoonlyoffergasinconjunctionwithanelectricitycontractitshouldbenotedthatthebeststandalonegasofferisAGL’s(chart25).Chart25AGLNorthgaszone:Estimatedannualbills(inclGST)forgasstandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum53

52Onlyretailersthatofferstandalonegascontractshavebeenincludedinthisfigure.Thesebillestimatesarebasedonratespublishedontheretailers’websitesbetweenthe2ndandthe20thofJanuary2016anditmustbenotedthatretailersmaychangetheirratesatanytime.53Discounts(excludingGST)havebeenappliedtoconsumptionand/ortotalbillasperofferslistedinthetable4.

AGL $1,215(2)




800

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

RetailoffersinAGLNorthgaszone


41

Figure12belowshowsestimatedannualbillsforstandalonegasmarketofferspostdiscountsintheAGLNorthgaszoneaswellashowtheyrankedcomparedtootherretailerssixmonthsago(inbrackets).Thedifferencebetweenthebest(AGL)andtheworst(EnergyAustralia)isonly$15perannum.Figure12AGLNorthgaszone:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum54

TruCentralGasZone

IntheTruCentralgaszone,averageconsumptionhouseholdsontheworststandingoffer can save approximately $480 per annum if switching to the best publishedmarketoffer.Dodoistheretailerwiththebestmarketofferratesinthisgaszone,however,asDodoonlyoffergasinconjunctionwithanelectricitycontractitshouldbenotedthatthebeststandalonegasofferisOrigin’s.Seechart26below.


AGL $1,306(2)




42

Chart26TruCentralgaszone:Estimatedannualbills(inclGST)forgasstandingandmarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum55

Figure13belowshowsestimatedannualbillsforstandalonegasmarketofferspostdiscountsintheTruCentralgaszoneaswellashowtheyrankedcomparedtootherretailerssixmonthsago(inbrackets).Thedifferencebetweenthebest(Origin)andtheworst(EnergyAustralia)isapproximately$30perannum.Figure13TruCentralgaszone:Lowesttohighestannualbills(inclGST)formarketofferspostJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum56


900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

1,700

RetailoffersinTruCentralgaszone



AGL $1,312(2)



43

2.3Marketofferprices–monthbymonth

2.3.1Incumbents’electricitymarketoffersJuly2015toJanuary2016

Asdiscussed in relation toelectricity standingoffers in section1.2above, retailersmaynotpasson savings fromreducednetworkcostsequally inallnetworkareas.This section analyses AGL, Origin and Energy Australia’s monthly market offers(includingdiscountsandpayontimediscounts)inCitipower’sareafromJuly2015toJanuary2016.57AGL and Origin’s respective market offer rates remained consistent from July toDecember 2015 before increasing the fixed supply charge, reducing theirconsumptioncharge,andrestructuringtheirtariffs(fromanincliningblocktarifftoaflat tariff) in January2016.EnergyAustralia,on theotherhand,hasnotmadeanyrate or tariff structure changes. In regards to other aspects of the offers, such asdiscounttypes,discountsizeandotherincentives,allthreeretailersmadenumerouschangesovertheperiod.Keychangesforeachofthethreeretailerswere:AGL’s ‘Savers’ product went from offering a 15% guaranteed discount off theconsumption rates for the period July to September, to offer a 28% pay on timediscount(offconsumption)inOctober2015.Thisdiscountwasreducedto24%thefollowingmonthbeforeitwentupto26%inDecember.AGLhasalsointroducedanadditionaldual fueldiscount (currently2%off consumption)andawelcomecredit(currently$25)forcustomersthatsigneduponlineduringthisperiod.InNovember,when the pay on time discount was 24%, AGL also had a limited time offer thatincludedonemonthof freeelectricity tonewcustomers.Theoffer’savailability tosolarcustomershasalsochangedoverthisperiod.Origin’s ‘Daily SaverPlus’productwent fromofferinga30%payon timediscount(offconsumption)inJuly2015to28%inAugustandSeptember.Origin’s‘DailySaverPlus’wasreplacedbythe‘OriginSaver’inOctoberandthepayontimediscountwasfurtherreducedto26%.58 InOctoberandNovemberOriginalsoofferedadualfuelwelcomecredit tonewcustomers ($125)andawelcomecredit forcustomers thatsignuponline(still$25).EnergyAustralia’s ‘FlexiSaver (MaxOffer)’has remained thesameapart fromthepayontimediscountgraduallyreducingfrom35%(offconsumption)inJuly2015to29%inJanuary2016.InDecemberEnergyAustraliaalsointroducedawelcomecreditfornewcustomers(currently$50).Chart27belowshowsthethreeretailers’marketofferstonewcustomersasannualbills(forcustomersusing4,800kWh/annum)foreachofthe7months.Itshowsthat

57Thesemarketoffersarebasedonthesingleratetariffonlyandtheywerecollectedfromtheretailers’websitesinthemiddleofeachcalendarmonth.58Originalsointroduceda‘Maximiser’productbutasthisproductisbasedondiscountsconditionaluponpaymentbydirectdebitwehavenotusedthisproductofferfortheTariff-Tracker.AGLalsohasadirectdebitproduct‘SetandForget’thatwedonotuseforthisanalysis.

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Energy Australia and Origin’s market offers have gradually increased during thisperiod(duetolowerpayontimediscounts)whileAGL’sofferhasrecentlydecreasedas would be expected due to falling network/metering costs. As AGL went fromoffering a guaranteed discount to a conditional pay on time discount in October2015,thispricedropwouldonlyapplytonewcustomersthatareabletopaytheirbills on time. Another interesting aspect demonstrated by chart 27 is that thedifferencebetweenthethreeincumbents’marketoffershasbeendecreasing.ThereiscurrentlynodifferencebetweenthesetwooffersbyAGLandOrigin(includingthewelcome credit as both retailers offer $25) and Energy Australia’s offer currentlyproducesanannualbillthatisonly$30less.Chart27Citipower’snetworkarea:Estimatedannualbills(inclGST)forelectricitymarketoffersfromJuly2015toJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming4,800kWhperannum(singlerate)

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2.3.2Incumbents’gasmarketoffersJuly2015toJanuary2016

Inrelationtothegasmarketoffers,allthreeincumbentretailers’respectivemarketoffer rates remainedconsistent fromJuly toDecember2015before increasing thefixedsupplychargesaswellasconsumptioncharges inJanuary2016. Inregardstoother aspects of the offers, such as discount size and other incentives, all threeretailersmade some changes over the period. Key changes for each of the threeretailerswere:AGL’s ‘Savers’ product included a 16% pay on time discount off the consumptionratesduringthewholeperiodexceptforinNovember2015whenthediscountwasreducedto14%.TheNovemberofferhoweverdidincludeonemonthworthoffreegas.AGL’soffersalsoincludedanadditionaldualfueldiscount(2%offconsumption)for four of the sevenmonths and awelcome credit (currently $25) for customersthatsigneduponlineduringthisperiod.

Origin’s‘DailySaverPlus’productwentfromofferingan18%payontimediscount(offconsumption)inJulyto15%inAugustandSeptember.Origin’s‘DailySaverPlus’was replaced by the ‘Origin Saver’ in October and the pay on time discount wasfurtherreducedto13%.59 InOctoberandNovemberOriginalsoofferedadualfuelwelcome credit to new customers ($150). SinceOctoberOrigin has also offered awelcome credit to customers that sign uponline (firstworth $50 and currently at$25).Energy Australia’s ‘Flexi Saver (Max Offer)’ product included a 22% pay on timediscount (offconsumption) fromJuly toNovember. InDecemberthisdiscountwasreduced to 18%. At the same time they reduced the discount, Energy Australiaintroducedawelcomecreditfornewcustomers($50).Chart28belowshowsthethreeretailers’marketofferstonewcustomersasannualbills(forcustomersusing63,000Mj/annum)foreachofthe7months.ItshowsthatEnergy Australia and Origin’s market offers have gradually increased during thisperiod due to lower pay on time discounts and higher rates from January 2016.AGL’soffer increasedinJanuary2016(duetohigherrates)andwhilewenotethatthechartshowsanAGL increase inNovember2015,duetothe lowerpayontimediscountthatwasbeingoffered,westressthatthevalueofonemonthfreegashasnotbeenincludedinthesebillestimates.In contrast to the electricity market offers discussed above (section 2.3.1), thedifference between the three incumbents’ market offers has increased. EnergyAustralia’soffercurrentlyproducesanannualbillthat isapproximately$100lowerthan Origin’s offer. In July 2015, the maximum difference to the annual bill wasapproximately$60.

59Originalsointroduceda‘Maximiser’productbutasthisproductisbasedondiscountsconditionaluponpaymentbydirectdebitwehavenotusedthisproductofferfortheTariff-Tracker.AGLalsohasadirectdebitproduct‘SetandForget’thatwedonotuseforthisanalysis.

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Chart28Multinet/OriginMetrogaszone:Estimatedannualbills(inclGST)forgasmarketoffersfromJuly2015toJanuary2016,includingdiscountsandpayontimediscounts-Householdsconsuming63,000Mjperannum

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2.4Discounting

In the July 2015 Victorian Tariff-Tracking report we highlighted the issue ofincreasingdifferencesbetweenstandingofferandmarketofferbillsdue to recordhighpayontimediscountsofferedbytheretailers.60TheJulyreportstated:

“Approximately 25% of customers are still on standing offers in Victoria.Thesecustomerspayincreasinglymoreforelectricitycomparedtocustomersonmarketoffersandsodomarketoffercustomersunabletopaytheirbillson time, as they effectively pay standing offer rates. Two years ago, theaverage standing offer was 20% more than the average market offer(includingdiscounts).Nowtheaveragestandingoffer is25%morethantheaveragemarketoffer.61”

The above analysis (section 2.3) shows that the incumbent retailers typically offerlowerpayontimediscountnowcomparedtoJuly2015,andthedifferencebetweentheaveragestandingoffer(allretailers)andtheaveragemarketoffer issomewhatlower (currently 23-25%) compared to July last year. Chart 29 below shows thedifference between average standing offer and market offer bills (includingdiscounts)foreachnetworkareaasofJanuary2016.62

Chart 29 Estimated average annual bills for standing offer (SO) andmarket offer (MO) customersusing4,800kWhperannum(singlerate)inJanuary2016

60SeeStVincentdePaulSociety,VictorianEnergyPricesJuly2015–AnupdatereportontheVictorianTariff-TrackingprojectbyMayMausethJohnston(July2015)61Averagebasedonallretailersinallnetworkareasandbillsbasedonhouseholdsusing4,800kWh/annum,singlerate.62Allmarketofferswerecollectedbetweenthe2ndand20thofJanuary2016.

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AMinisterialOrderpublishedintheVictorianGovernmentgazetteon23December2015,requiredVictorianretailerstogazetteon27January2016iftheyintendedtochange their standing offer prices. The next opportunity to change standing offerpricesis3June2016.63AsmanyretailersgazettedearlierinDecember2015(priortothisordertakingeffect)onlyahandfulofretailersgazettedon27January,thesewereSimplyEnergy,Momentum,GlobirdandNext(thetwolatterarenewretailersnot yet included in the Tariff-Tracking project). Some retailers, however, did notgazetteinDecember2015oronthe27ofJanuary.Theseare:

• Dodo-lastgazettedelectricitytariffson1July2014• Commander-lastgazettedelectricitytariffson1July2014• PeopleEnergy-lastgazettedelectricitytariffson30January2014• RedEnergy-lastgazettedelectricitytariffson30December2014• DiamondEnergy–lastgazettedelectricitytariffsinMarch2015

ContrarytoourJuly2015recommendationthatcalledforanarrangementof fixedgazettaldateswhereretailerscanchangeormaintaintheirpricesbutarerequiredtoexplaintherationalefortheirdecisioninasupplementarystatement,theMinisterialOrderdidnot require retailers toexplainwhy theydecide tochangeorkeep theirstanding offer prices the same. By the time retailers next have an opportunity togazettestandingofferprices,DodoandCommanderwillhavehadthesamestandingofferpricesfortwoyears.64Bothretailersusetheirstandingofferpricesasthebaserate for theirmarketoffers, effectivelymeaning that the sizeof theirpayon timediscount is the key feature to reflect changes to their cost structures (such as adecrease in regulatednetwork/meteringcharges).65 Wenonethelesswelcome theMinisterial Order requiring retailers to gazette on a specific date and we willcontinuetomonitortheimpactthishasonstandingofferratesaswellasthemarketofferdiscounts.

63VictorianGovernmentGazetteNo.S434,23December201564Bythenextopportunitytogazettestandingofferson3June2016,DodoandCommander’sstandingofferpriceswillbetwoyearsold.65Dodocurrentlyoffers30%payontimediscountoffconsumptionchargeswhileCommanderoffers20%.Neitherretailerincreasedtheirpayontimediscounttoreflectlowerregulatednetwork/meteringchargesinJanuary2016.

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3.Changestothesupplycharge

Thesupplychargeisafixeddailychargethatispaidinadditiontotheconsumptionchargesforelectricityandgasused.Thesupplychargevariessignificantlybetweenretailers and whilst a high fixed charge generally indicates lower consumptioncharges, it is crucial that consumers are aware of the supply charge in order tochooseenergyoffersthatbestsuittheirusage level.Lowconsumptionhouseholdsshouldlookforenergyofferswithalowfixeddailycharge.3.1Electricitysupplycharge

Inregardstothethreeincumbentretailers,charts30to34belowshowthat:

• InCitipowerandPowercor’sareas,all threeretailershavehigherelectricitysupply charges in January 2016 compared to one year ago. In SP Ausnet,Jemena and United Energy’s network areas, all of the incumbent retailershave reduced their supply charge. However, the size of the increases, anddecreases,variessignificantlybetweentheretailersaswellasnetworkareas.

• AGL’selectricitystandingoffershavethehighestsupplychargeinallnetwork

areascomparedtotheotherincumbentretailers.

Chart30Changestotheelectricitysupplycharge(c/day)forstandingoffers(singlerate,incGST)fromJanuary2012toJanuary2016intheCitipowernetwork

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Chart31Changestotheelectricitysupplycharge(c/day)forstandingoffers(singlerate,incGST)fromJanuary2012toJanuary2016inthePowercornetwork

Chart32Changestotheelectricitysupplycharge(c/day)forstandingoffers(singlerate,incGST)fromJanuary2012toJanuary2016intheSPAusnetnetwork

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Chart33Changestotheelectricitysupplycharge(c/day)forstandingoffers(singlerate,incGST)fromJanuary2012toJanuary2016intheJemenanetwork

Chart34Changestotheelectricitysupplycharge(c/day)forstandingoffers(singlerate,incGST)fromJanuary2012toJanuary2016intheUnitedEnergynetwork

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3.2Gassupplycharge

Inregardstothethreeincumbentretailers,charts35to37belowshowthat:

• Allthreeofthem,exceptforOrigininthethreeSPAusnetzones(TruWest,AGLNorthandTruCentral),havehighergassupplychargesinJanuary2016compared to one year ago.66 However, the size of the increase variesbetweentheretailersaswellasgaszones.

• Theaveragegassupplychargeisnow$275perannum.

• AGListheretailerwiththegreatestincreasetotheirsupplychargeoverthelast year (since January 2015). AGL increased its supply charge by 13% onaverage(acrosstheeightmaingaszones).

• The single highest gas supply charge of approximately $300 per annum is

appliedtoAGLcustomersintheAGLNorthgaszone.Charts35-37belowshowsupplychargesasannualcostsforthethreeincumbentretailersfromJanuary2012toJanuary2016acrosstheeightmaingaszones.Since 2012, AGL has increased its standing offer supply charges by approximately60%intwoofthegaszoneswhereitistheincumbentretailer(AGLSouthandAGLNorth). In the gas zones where Origin and Energy Australia are the incumbentretailers,thesupplychargeshaveincreasedby30–40%overthesameperiod.Chart35AGL’sgassupplycharge($/annum)forstandingoffers(incGST)fromJanuary2012toJanuary2016inallgaszones

66TheSPAusnetgaszonesareTruWest,AGLNorthandTruCentral

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Chart36Origin’sgassupplycharge($/annum)forstandingoffers(incGST)fromJanuary2012toJanuary2016inallgaszones

Chart37EnergyAustralia’sgassupplycharge($/annum)forstandingoffers(incGST)fromJanuary2012toJanuary2016inallgaszones

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4.Totalcostofenergyandpricechangesbyarea

Asapproximately60%ofVictorianhouseholdsareconnectedtobothelectricityandgas, it is important toanalysewhether thereareareas thathaveexperiencedhighincreasesinbothelectricityandgasprices,andconversely,whetherthereareareaswheretheincreasesinelectricityandgaspricesareatthelowerend.Suchanalysisallows for a more detailed understanding of the total energy costs faced byhouseholdsacrossVictoria.67Theanalysispresentedinthisreportshowsthatsomeareashaveexperiencedhigherprice increasesthanothersoverthe last12monthsandthatthesepriceincreasesaremostlyduetotherisingcostofgas.

Table5Electricitystandingofferpricechanges(average)byareaJanuary2015toJanuary2016

Area AnnulbillchangesinceJanuary2015

Percentagechange

InnercityandEasternsuburbs(Citipower) -$5 -0.3%

OuterWesternsuburbsandWesternVictoria(Powercor)

-$80 -$70* -4.5% -3%*

OuterNorthernandEasternsuburbsandEasternVictoria(SPAusnet)

-$105 -$115* -5.5% -5%*

InnerWestandNorthernsuburbs(Jemena) -$75 -4%

OuterSouthEasternsuburbsandMorningtonPeninsula(UnitedEnergy)

-$50 -3%

*Forall-electrichouseholdswithpeak/off-peak(controlledload)rates

67Thefiguresintables3and4arebasedontheincumbentretailers’averagestandingofferforelectricityandgascustomersfordualfuelhouseholdsusing4800kWhand63,000Mjperannum,andall-electrichouseholdsusing7000kWh(thereof30%off-peak).Tocalculatetheincreaseswehaveusedtheaverageoftheincumbentretailers’standingofferratesratherthantheaverageofallstandingoffers.Thiswasdonebecausethevastmajorityofcustomersonthestandingofferarewiththeincumbents(AGL,OriginandEnergyAustralia).Furthermore,asdiscussedabove,marketoffersdogenerallyreflecttheincreasestothestandingoffers.

55

Table6Gasstandingofferpricechanges(average)byareafromJanuary2015toJanuary2016

Area AnnulbillchangesinceJanuary2015

Percentagechange

EasternandSouthEasternsuburbs(OriginMetrozone)

$105 7.5%

BaysideandouterSouthEasternsuburbs(AGLSouthzone)

$130 9.5%

NorthernandNorthEasternVictoria(OriginNorthzone)

$90 6%

CBD,innercityandNorthEasternsuburbs(TRUEastzone)

$115 8.5%

Frankston,MorningtonPeninsulaandGippsland(OriginSouthEastzone)

$100 7%

MacedonRanges,Bendigo,BallaratandWesternVictoria(TRUWestzone)

$60 4.5%

WesternandNorthWesternsuburbs(AGLNorthzone)

$105 7%

OuterWesternsuburbs,GeelongandBellarinePeninsula(TRUCentralzone)

$65 4.5%

Table7Averageannualbillsforelectricitystandingoffercustomersandmarketoffercustomersbyarea,January2016(singlerate,4800kWhperannum)anddifferencetoannualbill

Area Averagestandingoffer^

Averagemarketoffer*

Difference

InnercityandEasternsuburbs(Citipower) $1,550 $1,250 $300(24%)

OuterWesternsuburbsandWesternVictoria(Powercor)

$1,750 $1,450 $300(21%)

OuterNorthernandEasternsuburbsandEasternVictoria(SPAusnet)

$1,840 $1,580 $260(16%)

InnerWestandNorthernsuburbs(Jemena) $1,740 $1,450 $290(20%)

OuterSouthEasternsuburbsandMorningtonPeninsula(UnitedEnergy)

$1,640 $1,350 $290(21%)

^Averageannualbillbasedonthethreeincumbents’standingoffers*Averageannualbillbasedonallretailers’marketofferspostdiscounts/payontimediscount

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Table8Averageannualbills for gas standingoffer customersandmarketoffer customersbyarea,January2016(63,000Mjperannum)anddifferencetoannualbill

Area Averagestandingoffer^

Averagemarketoffer*

Difference

EasternandSouthEasternsuburbs(OriginMetrozone)

$1,470 $1,270 $200(16%)

BaysideandouterSouthEasternsuburbs(AGLSouthzone)

$1,470 $1,270 $200(16%)

NorthernandNorthEasternVictoria(OriginNorthzone)

$1,520 $1,310 $210(16%)

CBD,innercityandNorthEasternsuburbs(TRUEastzone)

$1,520 $1,310 $210(16%)

Frankston,MorningtonPeninsulaandGippsland(OriginSouthEastzone)

$1,520 $1,310 $210(16%)

MacedonRanges,Bendigo,BallaratandWesternVictoria(TRUWestzone)

$1,410 $1,230 $180(15%)

WesternandNorthWesternsuburbs(AGLNorthzone)

$1,520 $1,310 $210(16%)

OuterWesternsuburbs,GeelongandBellarinePeninsula(TRUCentralzone)

$1,520 $1,320 $200(15%)

^Averageannualbillbasedonthethreeincumbents’standingoffers*Averageannualbillbasedonthefourretailersthatoffergasasadinglefuelproduct.Alloffersincludediscounts/payontimediscount

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4.1Innercity,innerNorthandEasternsuburbs

Source:Citipower

The electricity standing offer has on average decreased by $5 for averageconsumptionhouseholds (4800kWh)overthe lastyear forhouseholds inthisarea.Households in the TRU East gas zone (CBD and innerNorth) have experienced anincreaseingaspricesofapproximately$115overthesameperiod.

• HouseholdswithanaverageconsumptionofelectricityandgasinMelbourne(CBD),Brunswick,Carlton,Fitzroy,Northcote,RichmondandCollingwoodwilltypicallyreceiveanincreaseinenergycostsof$110comparedtolastyear.68

• Householdswithanaverageconsumptionofelectricityandgas inthe inner

Eastern suburbs of Kew,Hawthorn, Camberwell andBalwyn, and the innerSouthEastareasofSouthYarra,Prahran,Armadale,ToorakandCaulfield,willtypicallyreceiveanincreaseinenergycostsof$100comparedtolastyear.69

• Householdswithanaverageconsumptionofelectricityandgas inthe inner

city bay side suburbs of St Kilda, Port Melbourne, Albert Park and SouthMelbourne will typically receive an increase in energy costs of $125comparedtolastyear.70

68ThesearehouseholdsinCitipower’selectricitydistributionnetworkandEnvestra’sTRUEastgaszone.69ThesearehouseholdsinCitipower’selectricitydistributionnetworkandMultinet’sOriginMetrogaszone.70ThesearehouseholdsinCitipower’selectricitydistributionnetworkandMultinet’sAGLSouthgaszone.

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4.2InnerWestandNorthWesternSuburbs

Source:EssentialServicesCommission

The electricity standing offer has on average decreased by $75 for averageconsumption households (4800kWh) over the last year for customers in this area.Households intheAGLNorthgaszone(WesternandNorthWesternsuburbs)haveexperiencedanincreaseingaspricesofapproximately$105overthesameperiod.

• HouseholdswithanaverageconsumptionofelectricityandgasinFootscray,Yarraville, Williamstown, Flemington, Moonee Ponds, Broadmeadows,Coolaroo, Braybrook and Sydenham will typically receive an increase inenergycostsof$30comparedtolastyear.71

• HouseholdswithanaverageconsumptionofelectricityandgasinHeidelberg,

Fairfield, Ivanhoe, Bundoora, Thomastown, Preston, Reservoir will typicallyreceiveanincreaseinenergycostsof$45comparedtolastyear.72

71ThesearehouseholdsinJemena’selectricitydistributionnetworkandSPAusnet’sAGLNorthgaszone.72ThesearehouseholdsinJemena’selectricitydistributionnetworkandEnvestra’sTRUEastgaszone.

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4.3SouthEasternsuburbsandMorningtonPeninsula


The electricity standing offer has on average decreased by approximately $50 foraverageconsumptionhouseholds(4800kWh)overthelastyearforcustomersinthisarea.HouseholdsintheOriginSouthEastgaszone(MorningtonPeninsulaandouterSouthEasternsuburbs)haveexperiencedanincreaseingaspricesofapproximately$130overthesameperiod.

• HouseholdswithanaverageconsumptionofelectricityandgasinthebaysidesuburbsofElwood,Elsternwick,Brighton,Sandringham,Beaumaris,ChelseaandSouthEasternSuburbsofBentleigh,Moorabbin,Springvale,NoblePark,Keysborough will typically receive an increase in energy costs of $80comparedtolastyear.73

• Households with an average consumption of electricity and gas in the

suburbs of Seaford and Frankston and on the Mornington Peninsula willtypicallyreceiveanincreaseinenergycostsof$50comparedtolastyear.74

• HouseholdswithanaverageconsumptionofelectricityandgasintheEastern

suburbs of Bulleen, Templestowe, Box Hill, Doncaster, Mitcham, Vermont,

73ThesearehouseholdsinUnitedEnergy’selectricitydistributionnetworkandMultinet’sAGLSouthgaszone.74ThesearehouseholdsinUnitedEnergy’selectricitydistributionnetworkandEnvestra’sOriginSouthEastgaszone.

60

GlenWaverlyandChadstonewilltypicallyreceiveanincreaseinenergycostsof$55comparedtolastyear.75

4.4OuterWesternsuburbsandWesternVictoria

Source:Powercor

All-electric households in this areawould have typically experienced an electricityprice decrease of $70 over the last year (based on average consumption of7000kWh).76Fordual fuelhouseholds theelectricity standingofferhasonaveragedecreasedbyapproximately$80overthelastyear(basedonaverageconsumptionof4800kWh).Totalenergycostdecreases fordual fuelhouseholds in theWesternregionwilltypicallyamountto:

• $20 for average consumption households in Hoppers Crossing, Werribee,GeelongregionandontheBellarinepeninsula.77

• $20 for average consumption households in Macedon, Kyneton, Ballarat,

Colac,Warrnambool,Portland,Hamilton,Horsham,AraratandDaylesford.78

75ThesearehouseholdsinUnitedEnergy’selectricitydistributionnetworkandMultinet’sOriginMetrogaszone.76Basedontheaverageelectricitystandingofferforhouseholdstakingcontrolledloadoff-peak(annualconsumptionof7000kWh,70%peakand30%off-peak).77ThesearehouseholdsinPowercor’selectricitydistributionnetworkandSPAusnet’sTRUCentralgaszone.78ThesearehouseholdsinPowercor’selectricitydistributionnetworkandSPAusnet’sTRUWestgaszone.

61

For average consumptionhouseholds inNorthernVictorian towns such as Echuca,SheppartonandHeathcotetotalenergycostswillremainstableorbeaffectedbyasmallincrease($5).794.5OuterNorthernandEasternsuburbsandEasternVictoria


All-electric households in this areawould have typically experienced an electricityprice decrease of $150 over the last year (based on average consumption of7000kWh).80Fordual fuelhouseholds theelectricity standingofferhasonaveragedecreasedby$105overthelastyear(basedonaverageconsumptionof4800kWh).ForaverageconsumptionhouseholdsintheOuterNorthernandEasternsuburbsofWarrandyte,Ringwood,ChirnsideParkandtheareaaroundMountDandenongthetotal energy cost will remain the same.81 Customers in other pricing zones innorthernandeasternVictoriawillreceiveminorpricedecreases:

• $15foraverageconsumptionhouseholdsinKilmore,Seymour,VioletTown,Nagambie,Wangaratta,ChilternandWodonga.82

• $5foraverageconsumptionhouseholdsintheLaTrobeValleyandSaleinthe

Gippslandregion.83

79ThesearehouseholdsinPowercor’selectricitydistributionnetworkandEnvestra’sOriginNorthgaszone.80Basedontheaverageelectricitystandingofferforhouseholdstakingcontrolledloadoff-peak(annualconsumptionof7000kWh,70%peakand30%off-peak).81ThesearehouseholdsinSPAusnet’selectricitydistributionnetworkandMultinet’sOriginMetrogaszone.82ThesearehouseholdsinSPAusnet’selectricitydistributionnetworkandEnvestra’sOriginNorthgaszone.83ThesearehouseholdsinSPAusnet’selectricitydistributionnetworkandEnvestra’sOriginSouthEastgaszone.

victorian energy prices january 2016...2 the victorian tariff-tracking project to date, this project...

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