Households are saving up to $760 a year on power bills due to increased competition in the market, the Australian Energy Market Commission says.
AEMC’s annual review of retail competition found nearly one-quarter of customers had changed retailers, opting to leave bigger companies for smaller players.
The report covers residential and small business consumers in retail electricity and gas markets in Queensland, NSW, ACT, Victoria, South Australia and Tasmania.
AEMC chairman John Pierce says retailers are moving towards more simple and stable price deals, and away from confusing offers for customers.
“Increased competition has led to price cuts and large reductions in market concentration,” he said.
Standing offer prices fell up to four per cent in southeast Queensland, while market offers fell by up to seven per cent in the same region in 2018.
Mr Pierce also says vulnerable customers need greater support to manage their power bills, including earlier identification of customers in hardship and more awareness of the help that is available.
Five new businesses entered the market, seeing record falls in market concentration across the National Electricity Market.
For the first time Origin, AGL and EnergyAustralia no longer have the largest market shares in South Australia and southeast Queensland, the report found.
Those regions had the highest switching rates of 29 per cent.
Energy Minister Angus Taylor says he is encouraged to see the market offering simpler deals and better prices.
“But loyal customers stuck on standing offers are still paying extremely high prices,” he said.
“Depending on the region, the AEMC found that an average residential consumer on the median standing offer can save up to $760 by switching to the best market offer.”
From July 1 the federal government is introducing a default market offer, which will act as a price cap on standing offers.
Mr Pierce says consumers are “forging ahead” and taking up opportunities available through technology.
“They are doing this while too many players in the energy sector are talking their own book, twisting arguments to support their own interests in relation to what needs to be done,” he said.
Mr Pierce says the economic potential of battery storage meaning households could have a solar panel and storage system for the price of energy from the grid.
Meanwhile, the Australian Energy Market Operator has released its report on the adequacy of Victoria’s transmission network to see if it will be reliable during the next 10 years.
Due to risks coal-fired power stations in the Latrobe Valley may retire early, AEMO is considering options to expand the interconnection between Victoria and NSW.