Labor and Coalition to unveil competing plans to tackle soaring household power bills

VICTORIANS will today be presented with competing plans from the Andrews Government and State Opposition outlining how each party would tackle soaring household power bills. Here’s your first look at the two major election-year promise details.

EXCLUSIVE: RIVAL plans to slash power bills have been unveiled by the Premier and ­Opposition Leader less than a month before Victorians vote.

Premier Daniel Andrews will on Friday promise to scrap expensive “default” electricity and gas tariffs.

The Labor plan would force retailers to offer a lower price for default deals, putting a new ceiling in the market for those who have not shopped around.

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Opposition Leader Matthew Guy is aiming his pitch at almost 1 million low-income Victorians, by pledging to introduce an exclusive new discounted energy deal.

The “people power” scheme would see a Liberal-Nationals government tender for a low-income electricity and gas rate, available to pensioners and healthcare cardholders.

Using group buying power could drive discounts of up to 18 per cent for cash-strapped families, on top of the 17.5 per cent discounts they already get. Mr Guy said: “Under the deal we will strike with energy providers, low-income earners will be looking at savings of around $250 to $530 a year.”

Energy Minister Lily D’Ambrosio will outline how, under a re-elected Labor government, the Essential Services Commission would set a new default price, based on advice from an independent expert panel.

New laws would before parliament by July, should Labor be re-elected.

Power bills in Victoria soared hundreds of dollars after Hazelwood power station closed two years ago.

Mr Guy told the Herald Sun his plan would help many of 912,000 low-income Victor­ians “get back in control of their energy bills and leave more money in their pocket”.

The subsidy plan, which is likely to cost tens of millions of dollars, would be modelled on South Australia’s public retail energy deal, for which Origin Energy won the tender last year. It has led to discounts of about 18 per cent.

Mr Guy said the plan would be “opt-in” and part of the tender process would look at retailers that provide flexible payment options, no late-payment fees or penalties, and no exit, paper or credit card fees.

A re-elected Daniel Andrews government will scrap expensive “default” electricity tariffs. Picture: Nathan Dyer

Opposition Leader Matthew Guy’s people power” scheme involves a Liberal/Nationals government tender for a low-income electricity and gas tariff, available to pensioners and health care cardholders. Picture: Lawrence Pinder

His energy spokesman, David Southwick, said: “Victorians can’t afford another four years of Daniel Andrews and bigger electricity and gas bills.”

Labor’s plan follows calls by a government-appointed panel — led by former deputy premier John Thwaites — for a basic “no frills” tariff.

Ms D’Ambrosio said the plan for a new default deal would install a fairer price.

Retailers use the current default deal — which 6 to 10 per cent of households are on — to set their cheaper discounted offers, meaning a change could see more competitive prices elsewhere in the market.

The minister said big corp­orations had been “ripping consumers off” and “we’re putting power back in the hands of Victorians”.

“Only Labor will modernise our electricity system to transition Victoria to a more affordable, reliable and clean energy system,” she said.

The government will also direct the Essential Services Commission to review the Energy Retail Code to “ensure contracts are clear and fair”.

The government's plan comes on the day state and territory energy ministers meet in Canberra to discuss tackling power prices.

Prime Minister Scott Morrison this week unveiled a national plan to address default offers, accusing retailers of using them as a “high-priced benchmark from which their advertised market-based offers are derived”.

The push for a better benchmark price was also recommended by the Australian Competition and Consumer Commission.

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