Households have been stung by soaring energy costs over the past decade and the competition watchdog, the Australian Competition and Consumer Commission, has previously warned the electricity market “is largely broken and needs to be reset”.
New analysis commissioned by retailer Powershop quizzed 500 Australians and found 72 per cent of people hadn’t bothered to shop around for a new energy retailer in more than two years.
Only 13 per cent had taken the time to review their energy deals in the past two years.
Powershop chief executive officer Ed McManus said inertia could be hitting customers’ hip pockets hard and they should be reviewing their deals annually.
“Most retailers operate a model where in some cases within three months but more commonly 12 months, they change the price the customer is paying to a higher rate,” he said.
“And with most retailers you are on an introductory rate, sometimes for 12 months before the rates get jacked up.”
The research found 51 per cent had never switched energy providers.
The ACCC’s Retail Electricity Pricing Inquiry report released last year recommended 56 ways to fix power pricing issues.
As a result customers who are on expensive deals, known as standing offers, should experience some price relief by automatically being switched to cheaper offers, known as default market offers, from July 1.
Consumers in Tasmania, Western Australia and Northern Territory have limited choice of energy suppliers and should check they are on the correct tariff suited to their needs.
Energy comparison website Canstar Blue’s spokesman, Simon Downes, said energy prices were constantly changing, which meant consumers needed to be review their costs frequently.
“If you really want the best deal, you have to be willing to switch at least every quarter to chase the cheapest price,” he said.
“Looking at the supply and usage charges helps, but the water is muddied by the conditional discounts.
“You could have a low usage charge but a plan with a high usage charge and a bigger discount might actually be cheaper.”
Mr Downes said paying attention to the supply charges is particularly important for households with fewer people living under the one roof.
“If you are a small household, the supply charge might be a higher portion of your overall costs,” he said.
“Whereas if you are big household with five or six people the usage component is going to make up a higher portion of your costs.”
The Powershop research also found that 79 per cent of respondents receive their electricity bills quarterly, while only 17 per cent receive them monthly.
ENERGY BILL TIPS
• Try and reduce your energy consumption.
• Pull out your latest bill and look at the supply and usage charges.
• Do an online comparison at compare.energy.vic.gov.au or energymadeeasy.gov.au.
• Ring your retailer and ask for a better deal.
• If you don’t have any luck, switch.
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