POWER GURU IN THE DARK
COMMISSION CHAIR’S FRANK ADMISSION:
THE man tasked by the Federal Government to investigate power prices is unsure he’s on the best deal even after shopping around.
Australian Competition and Consumer Commission chairman Rod Sims said he decided to hunt for a new offer after the ACCC embarked on a recently completed 400-page, 200,000word report into energy costs.
“We did, off the back of the study, shop around and we did save money,” Mr Sims said.
“Whether we are on the best offer or not I don’t know. It is confusing, no doubt.”
IT IS the ultimate proof of how confounding electricity plans have become – the man who oversaw an investigation into lowering prices is unsure he’s on the best deal even after shopping around. Australian Competition and Consumer Commission chairman Rod Sims said he decided to hunt for a new offer after the ACCC embarked on a recently completed 400-page, 200,000word report into energy costs at the request of the Federal Government.
“We did, off the back of the study, shop around and we did save money,” Mr Sims said. “Whether we are on the best offer or not I don’t know. It is confusing, no doubt.” To make it easier to compare offers the ACCC has proposed default tariffs set by its energy division, plus a change that would require all discounts to use that default price as the reference. The default tariff would be much lower than current “standing offers”, Mr Sims said, which electricity retailers had inflated so they could advertise bigger headline discounts without really cutting prices.
In addition to duping all consumers with dodgy discounts, the ACCC report shows that raising standing offers is smashing 300,000 southeast Queensland households on such plans.
“We have got to take the obscenity, the fluff, out of these standing offers,” Mr Sims said.
Default tariffs would save Gold Coast households on standing offers at least $106 a year, the ACCC estimates.
The Federal Government is yet to green-light the default tariff idea, but Mr Sims revealed he expected it would.
Energy minister Angus Taylor said “setting a competitive default price for electricity is one of the most effective measures to drive down power bills”.
The ACCC’s report, delivered in July, makes 56 recommendations to reduce prices, including backing the Coalition’s now-defunct National Energy Guarantee plan, killed off in August under pressure from Government MPs opposed to its emissions reduction commitments.
Mr Sims said public policy on energy should have three goals: sustainability, reliability and affordability. The ACCC was only concerned with affordability, he said.
In a major speech in Sydney today he will deliver this message: “We can get on with attacking affordability even while people are debating the other two.”