Renters and families to be hit hardest by new gas price rises, advocates warn
Consumer advocates are warning about the disproportionate cost-ofliving impact on renters and families already struggling with energy bills as hefty gas price hikes hit four Australian states on Wednesday.
Gas companies, including AGL, Origin Energy, EnergyAustralia and Powershop, announced in January that they would again be raising prices, including daily supply charges, for many residential and business customers on 1 February.
The price rises are steepest and most highly concentrated in Victoria, with companies estimating residential gas bills to increase on average by up to $480 a year, depending on usage.
They come as figures from the Consumer Policy Research Centre (CPRC) suggested more than one in 10 Victorians are seeking financial hardship support from their energy provider.
Unpublished data provided exclusively to Guardian Australia from a representative survey of 1,500 Victorians conducted by CPRC in November last year shows 11% of respondents had already asked for bill payment assistance from their energy provider – nearly double the rate of hardship assistance requests made for mobile, internet or banking services.
One in 20 people (5%) had borrowed money from friends or family to pay their energy bill and 6% reported they had to miss a payment.
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The centre’s chief executive, Erin Turner, said in the context of cost-ofliving increases, energy bills seemed to be running ahead of other essential services, with 7% of respondents seeking help with their mobile phone bills, 6% needing help to pay for internet and 6% appealing to their bank for hardship assistance.
“There is a growing cost-of-living problem,” Turner said. “This will only get worse as the cost of essentials, like gas and housing, continue to rise. What is really concerning is this is hitting families particularly hard.”
The survey showed 22% of single parents and 16% of couples with children had asked for payment assistance on an energy bill, while 16% of single parents and 8% of couples with children said they had to miss a payment.
Renters found things more difficult than other cohorts: nearly 17% skipped a meal due to household costs compared with 9% of the total group surveyed and 14% of renters asked for payment assistance with an energy bill.
CPRC research had previously revealed that more than 35% of Australians eligible for concessions on their energy bills may not be receiving them due to the complexity of the different state schemes and bureaucratic “sludge” in sign-up processes.
In December the Australian Council of Social Service urged state energy ministers to commit to overhauling Australia’s hodge-podge, state-based energy concessions program to make it streamlined and equitable.
EnergyAustralia announced in January that its approximately 245,000 residential gas customers in Victoria on variable contracts would see their bills
increase by an average of 26.7% – an average of $480 a year, including supply charges and GST.
AGL increased gas prices for its variable rate customers in Victoria, New South Wales, Queensland and South Australia.
In Victoria AGL’s average increase was 24%, equating to approximately $321 a year, excluding GST. NSW saw a 9% increase, or $78 a year. The corresponding increases in Queensland and SA were 5% or $40 and 6.2% or $56 a year respectively.
The EnergyAustralia chief customer officer, Mark Brownfield, said at the time of the announcement that a “perfect storm of factors in 2022, including the war in Ukraine and extreme weather events” had pushed up wholesale gas prices and supply was still coming from contracts made during that time.
“We know the news of higher prices will not be easy for our customers,” Brownfield said. “If any of our customers believe they will be unable to meet their energy costs because of this increase, we can help through payment plans, extensions, a staying-connected guarantee and access to cashflow assistance for small businesses.”
An AGL spokesperson said the decision to increase prices was “based on a detailed consideration of a range of factors, including wholesale prices, network charges and market conditions, and the value we offer to customers”. The company encouraged customers to get in contact to seek support or assistance.
A spokesperson for Origin Energy said: “Increasing prices is never a decision we take lightly, especially at the moment when we know some people are struggling with higher costs of living.
“To help protect people who can least afford any price increases, we will invest at least $20m to support customers in our Power On program this financial year including offsetting any price increases to make sure they won’t be impacted.”
Powershop, which lists hardship provisions on its website, did not respond to a request for comment.