Energy Action Group

 

Full Retail Competition (Electricity)

 

Customer feedback & experiences

 

This page is dedicated to customer’s experiences in the market. Customers are invited to email or post their experiences, which may be published here. Customer’s stories are important because they form a part of the market surveillance required to keep the market honest. We want to hear about both the good and the bad.

 

eaginfo@vicnet.net.au

 

In particular EAG would simply like to know what kind of deal you got. What you are paying and what the terms & conditions are. This is important for two main reasons. Firstly, the retailers are not obliged to publish their offers (prices/terms & conditions) and at present there is not official or independent place customers can go to see whether offers are competitive or reasonable. Secondly, EAG is concerned that certain customers/customer groups may be discriminated against in the market (redlined). By sampling the contracts offered to customers it may be possible to detect patterns that point to discrimination.

 

Another phenomena of de-regulation that has already emerged in US electricity and telecommunications markets is ‘slamming’ – this is the terminating of customer’s contracts  when they become unprofitable. For example, company A has fifty thousand residential customers signed up to a specific price offer, but finds that it cannot purchase enough electricity for them at a price that delivers the company a profit. The solution is to dump customers on that contract: either making them sign to a more expensive contract or letting them go to rival firms. The National Electricity Market has distinct season variation in prices. A company may sign customers up in the winter when prices are low, and dump them in summer when wholesale prices go through the roof.

 

We thank you for your assistance.

Customer experiences

The following was posted on January 14th 2002 by Andrea Sharam of the Energy Action Group.

 

TXU asked the following questions:

  1. your name and address
  2. Which retailer are you currently with?
  3. How much consumption (either by the year or by the quarter)
  4. Number of people in the house
  5. do you agree to a credit reference check ?(I asked whether they would still supply me if I refused to agree to a check and they said yes)
  6. have you been disconnected in the last 6 months?
  7. are you on Easyway payments?
  8. Do you have air-conditioning?
  9. Does the house have both electricity and gas?

 

On the basis on answering to having Citipower as my current retailer, consuming 4620kWh per year, being a single person household, having an air-conditioner, not having been disconnected in the previous 6 months, not being on the Easyway scheme and being in an all electric house I was offered a “singles” tariff.

This involves paying

  1. standing charge of $39 per quarter
  2. 12cents kwh for the first 1500 kwh of consumption and 15 cents for the balance.
  3. the contract is for 1 year and if I stay the year I’d get a loyality payment of $25.00. If I were to leave TXU in that time I’d have to pay an exit fee of $50.00. If I pay the bill by direct debit (but not using my credit card) I’d receive a discount of $30 per year.

 

How does this rate against the “deemed/standing offer of Citipower?

Based on my last years worth of electricity consumption:

 

Citipower

                                                              

Standing charge                                             $138.56

Consumption up to 1020kwh @12.44ckwh           $126.88

Consumption balance (3600) @ 13.31kwh            $479.16

Total                                                         $743.88

GST                                                         $74.38

Amount payable                                           $818.26

 

The TXU offer

 

Standing charge                                             $156

Consumption up to 1500kwh @12.00ckwh           $180

Consumption balance (3120) @ 15.00kwh            $468

Total                                                         $804

GST                                                         $80.40

Amount payable                                           $884.40

 

 

$884.40 is the maximum cost. I could take the $25 loyality deal and pay by direct debit (save $30)

The minimum cost would $829.40! At best this is $11.14 worse than my current Citipower deemed tariff! BUT – I forgot to ask TXU whether the prices they were quoting was with or without GST. If the prices included GST then TXU would be the better deal by a minimum of $14.26 or a maximum of $69.26

 

2. Victorian Council of Social Service post warning on TXU tariffs – click here for details

 

3. AGL is mailing out offers to its existing customers and to customers of other retailers. The AGL offer promises a 30% (or around $120) discount off the standing charge over a three year period (or 25% for two years).

There is a price difference for existing customers to customers switching to AGL

For existing customers it is (offer issued 27/2/02 valid until 28 April)

First 1020kwh                  14.014 cents kwh

Bal                                14.784 cents kwh

Standing charge per quarter    $36.729

 

For customers switching from Citipower, it is (offer issued 4/402, valid until 3/6/02)

First 1020kwh                  13.684cents kwh

Bal                                14.641 cents kwh

Standing charge per quarter    $38.104 (discount makes it $26.6728)

 

What to watch out for?

* AGL reserves the right to vary the consumption charge virtually at any time for any reason

* $22 fee if you terminate you contract before the three years (or two) is up

* signing up will mean allowing them to do a credit check on you – you may find that AGL will choose not to give you a contract on the basis on such a credit reference check.

 

4. New independent retailer Powerdirect, (owned by Australian Energy Services) is offering (over the web – nice to see a retailer willing to put something on the web to make it easier for customers – but they could also actually state the price as opposed to the discount). The discount varies between which pre-competition retailer you were with (because of the underlying distribution cost). They offer 5% discount to residential customers, with some variation – check their website www.powerdirect.info/gain/lower2.html. They screen over the web but appear very slow to respond (no answer yet in my case). Terms and conditions appear not to be available on website.

 

 

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DISCLAIMER: The Energy Action Group makes all the editorial decisions as to what is published on this page.  The information that is provided to EAG for this page may not be independently verifiable and should be used as a guide only.

 

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