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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
2013-09-24 Daily Xml
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ELECTRICITY PRICES

The Hon. D.G.E. HOOD (15:40): I seek leave to make a brief explanation before asking the minister representing the Minister for Mineral Resources and Energy a question about contract prices for electricity.

Leave granted.

The Hon. D.G.E. HOOD: The Minister for Mineral Resources and Energy spoke on radio yesterday about loyal electricity customers who did not change retailers. I make no criticism of the minister; I think what he said is probably correct. He specifically said the following:

And once you're one of those sticky customers you're trapped because they will keep on putting up your power prices because they know that you will not move.

My understanding of retail contracts for electricity is that the retailer can increase the price, including during the one or two-year period when the customer is not able to change retailers without incurring a termination fee, and these increases are not limited to any increase approved by ESCOSA or any other body.

In the radio segment, the point was made that retailers increased their rates of charge to customers and then offered lower rates to new customers and to existing customers, but otherwise continued to charge the high prices to those who were locked in to contracts. The minister went on to say:

...25 per cent of all South Australians have not switched retailers since ETSA was privatised...those 25 per cent of South Australians are paying the highest possible bills in South Australia.

Again, I make it clear that I make no criticism of the minister, but these are very significant comments. My questions are:

1. How can it be that electricity retailers can increase their charge rates by an amount they decide while the customer is bound to continue for the contract period?

2. Some elderly and some disabled people are not able to cope with performing the calculations necessary for comparing rates offered by various retailers and may not feel comfortable or confident in confronting retailers about rates. What is the government doing to enable these people to access the same rates that are offered generally in the marketplace, that is, to new customers?

3. Has the government considered regulating or not regulating to prevent them from increasing rates to existing customers, as I have just outlined? What is the government's plan in order to address this problem?

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for the Status of Women, Minister for State/Local Government Relations) (15:43): I thank the honourable member for his most important questions. I will refer them to the Minister for Mineral Resources and Energy in another place and bring back a response.

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