More Australian families forced to disconnect power as costs soar

Families are being left in the dark as they buckle under the weight of electricity costs with disconnections soaring across Australia.

Exclusive: Families are being left in the dark as they buckle under the weight of electricity costs with disconnections soaring over the past year.

The Salvation Army and St Vincent De Paul have said they’ve seen an increase in the number of people reaching out to them for help with their electricity bills and disconnections.

And a number crunching of the latest national electricity disconnection figures from the Australian Energy Regulator obtained by News Corp Australia shows an 11 per cent increase over the year 2017-18 in residential electricity disconnections.

In Victoria, whose disconnection figures are reported through the Essential Services Commission, there has been a 35 per cent increase in disconnections over the past year — and that’s just based on figures for the first six months of 2017-18 with the full year figures to be released in coming weeks.

Excluding disconnections from AGL and Powerdirect, Victorian retailers disconnected 23,406 electricity residential customers in the first six months of the 2017-18 financial year.

This compares to the entire 2016-17 year when 17,304 electricity residential customers (excluding AGL and Powerdirect) were disconnected.

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Australians are struggling and have had to cut off power supplies. Picture: iStock.

In Queensland power companies have recorded a sharp rise in disconnections (up 10.75 per cent) while significantly reducing the number of customers they work with in hardship (down 5.34 per cent) and those on payment plans (down 10.24 per cent).

For example, while the number of Red Energy customers on payment plans decreased more than 16 per cent, the number of disconnections increased more than 250 per cent.

In the case of AGL, one of the top providers in QLD, the number of families disconnected from the grid was up more than 12 per cent to 4349. The average amount owed to AGL by their customers on hardship plan has also increased by almost $300. They reported a statutory profit of $1.6 billion last year.

In NSW, disconnections were up by more than 18 per cent and hardships were up nearly 19 per cent. Disconnections were up by more than 30 per cent for both of the biggest retailers, AGL and Origin.

The number of AGL customers on payment plans increased more than 40 per cent.

Households in NSW on a hardship program provided by their electricity retailer have increased at an alarming rate of nearly 63 per cent for the third largest retailer, Energy Australia, and 36 per cent for Origin electricity customers.

Power bills and energy is an issue the government cannot ignore. Picture: Steve Tanner

In South Australia, disconnections were down slightly, but hardships were up by more than 35 per cent.

The two biggest retailers recorded big increases in disconnections: AGL up 19 per cent and Origin up 56 per cent. AGL’s hardship customer numbers were up 67 per cent and customers on payment plans up 126 per cent, while Origin’s hardship cases were up 44 per cent.

Hardship cases have also risen nationally, climbing 13.7 per cent, but the number of payment plans being offered by retailers has fallen 5.7 per cent.

Electricity companies have opened up a war with the federal government saying the increased pressure on families is due to a lack of clear energy policy at the top levels of government which is keeping power prices high.

A spokesman for the Australian Energy Council, that represents retailers, said disconnections remain the very last resort for electricity companies.

“For their part retailers have recently announced reductions in some prices and continue to work to keep prices down, but the lack of a national energy policy will continue to put pressure on electricity costs,” the spokesman said.

Manager of policy and research at St Vincent de Paul Gavin Duffy said more families were in stress and hardship and the increased use of smart meters made disconnecting customers easier.

Electricity bill charges are becoming unaffordable. Picture: istock

“We do notice it is more likely that families are the ones being disconnected because when your kids are screaming you put food on the table and everything else is pushed to the side,” he said.

“We’ve seen the circus that is federal politics on this and one of the outcomes of a lack of clarity in energy and climate policy is uncertainty for investors and higher power prices for everyday Australians.”

The Salvation Army’s Brad McIver said an urgent “co-ordinated national strategy” was needed to stem the tide of people in distress.

The Australian Power Project’s Nathan Vass said the government needed to get tough and demand electricity companies did more for customers struggling with their power bills.

“It’s time for politicians of all persuasions to demand the energy companies provide affordable and reliable power supplies for Australian families and businesses,” Mr Vass said.

Chief executive of Energy Consumers Australia, Rosemary Sinclair, said in some cases Australians were being forced to choose between putting food on the table and keeping the lights on, or heating and cooling their home.

Australian Energy Minister Angus Taylor. Picture: AAP

“The whole energy sector needs to be focused on how to bring prices down to more normal levels and retailers need to work with their customers to reduce energy use,” Ms Sinclair said.

Energy Minister Angus Taylor said the Morrison government was committed to getting a better deal for Australians and keeping their lights on.

“My priority as Energy Minister is bringing power prices down, and we are already seeing results. Government pressure on retailers has already resulted in lower power bills from 1 January 2019 for more than half a million standing offer and concession customers in New South Wales, Victoria, South East Queensland and South Australia,” Mr Taylor said.

Labor’s opposition energy spokesman Mark Butler said Australia was in the “deep throes” of an energy crisis due to Liberal government policy and as a result power prices had skyrocketed.

“Australia still doesn’t have a coherent energy policy and the Liberals are still unable to deliver real energy policy because of their anti-renewables obsession,” Mr Butler said.

@pollietracker

ELECTRICITY DISCONNECTION FIGURES

QUEENSLAND

2016-17: 25,200

2017-18: 27,910

Change: +10.75 per cent

NEW SOUTH WALES

2016-17: 27,381

2017-18: 32,315

Change: +18.02 per cent

SOUTH AUSTRALIA

2016-17: 10,902

2017-18: 10,556

Change: -3.17 per cent

VICTORIA

2016-17: 17,304

2017-18 (first six months): 23,406

Change: +35.26 per cent

DEFINITIONS (ACCORDING TO THE AER)

PAYMENT PLAN

As customers experience payment difficulties, they are placed on a payment plan to manage their energy debt. A payment plan will consider a customer’s ability to pay, amount owed, and expected energy usage. The retailer and customer will then agree to an amount for the customer will pay over the next 12-18 months which considers the customer’s usage as well as any amount they may owe.

HARDSHIP PROGRAMS

Hardship programs are payment arrangement when a customer cannot meet the obligations of a standard payment plan due to an inability to meet payments for their energy debt and ongoing bills. Hardship programs often spreads the payment of arrears over 24 months and is typically reviewed quarterly. The customer will also receive a range of additional assistance from the retailer. A customer will not be disconnected while they meet their payments.

DISCONNECTIONS

Disconnection due to non-payment is a last resort used only after payment plans and hardship programs have been unsuccessfully attempted. AER also sees this as an indicator of affordability. The retailer and the customer will continue a dialogue to resolve payment issues with the customer and have electricity reconnected.

@pollietracker