Electricity
Industry Overview
Full Retail Competition
The Policy and Regulatory Framework
Customer Rights and Responsibilities
Concessions
Retailer Contacts
Industry Overview
There are four steps in supplying electricity to a Victorian electricity customer
- Generators (power stations) produce electricity and sell it in the wholesale National Electricity Market to retailers. Victorian generators are all privately owned.
- Electricity is then transported via high voltage transmission networks to a distribution centre. There are two transmission companies in
- Five distribution companies transmit electricity to all residential and business customers through their networks (the poles and wires). The distribution businesses own and manage the networks.
- Retail companies sell electricity directly to customers, purchasing it from the wholesale market and arranging its delivery to you through contracts with the transmission and distribution businesses.
Your main relationships will be with the retailer that supplies you electricity and the distributor who manages and repairs the poles and wires connecting you to supply.
Full Retail Competition
Since January 2002 all Victorian electricity consumers have been able to choose from which company to buy their electricity.
That means you can now choose to change your electricity company if you think another deal better suits your usage. Or if you are satisfied with the prices, terms and conditions of your current electricity contract, you don't have to do anything.
There are two possible ways you may end up changing retailers:
- Moving house. If you move into a new home (or change business address) and the electricity retailer is different to the retailer you had previously, then you have effectively 'changed' retailers, even if you didn't intend to. In this instance you have the option to
- Stay with your 'new' electricity retailer
- Change back to the 'old' retailer you were with before the move.
- Stay with your 'new' electricity retailer
- You make the choice to change. If you choose to change electricity retailers, you will be asked to enter a market contract, which may offer a better energy deal for your household - that could be lower prices, more convenient billing or other alternatives.
Or if you move into a new home or change your business address, the local retailer may be different to your previous retailer. In this instance you can choose any company to supply your energy.
The Energy and Water Ombudsman (Victoria) has produced a helpful brochure Changing Your Electricity or Gas Retailer (pdf) that contains a summary of your rights and what you need to consider when signing an energy contract.
The Policy and Regulatory Framework
The Commonwealth and Victorian governments share responsibility for policy development and regulation of the electricity sector.
A substantial reform process is now occurring under the auspices of the Council of Australian Governments (CoAG). It aims to improve the legislative framework for energy, in order to achieve an efficient, secure and competitive national energy market. More
Electricity is sold to energy retailers in ACT, NSW, QLD, SA and Victoria through the National Electricity Market (NEM). Market rules in the NEM are laid down in a national electricity code, which was developed by those five state jurisdictions. In
The ESC's primary objective under the Essential Services Commission Act 2001 is to protect the long term interests of Victorian consumers with regard to the price, quality and reliability of essential services. The ESC promotes competition, ensures minimum standards of service and conduct, enforces the consumer protections contained within the regulatory safety net, and regulates distribution prices. The ESC has the authority to issue licences, codes and guidelines, and make price determinations which regulate access to natural monopoly services.
The key agency advising the Victorian Government on energy policy is the Energy Division in the Department of Primary Industries (DPI).
Customer Rights and Responsibilities
Link to consumer issues page
Your bill
Each customer's bill typically comprises the following charges:
- Supply charge. This is a fixed charge applied to every billing period.
- Consumption charge, i.e. the price of the electricity you consume.
- This can be broken down into peak and off-peak prices
- It includes the retailer's profit margin and other charges, such as market fees.
- This can be broken down into peak and off-peak prices
There are a number of regulations relating to the sale and marketing of electricity. Of key relevance to residential small business users is the Energy Retail Code (pdf). All codes relevant to electricity can be accessed on the ESC website.
Concessions
The Department of Human Services (DHS) Concessions Unit administers concessions and grant schemes for eligible electricity customers. If you hold a pensioner concession card (PCC), health care card (HCC) or a GOLD card (from Department of Veterans' Affairs) you may be entitled to the some of the following concessions:
- Winter Energy Concession: 17.5% discount on electricity bills issued between May and November.
- Non-Mains Winter Energy:
- A three-tiered annual rebate available to people who spend $80 or more per annum on LPG or other alternative fuels (diesel, petrol, heating oil) as the main domestic energy source; and
- for customers who are being metered individually for their electricity consumption but also pay a caravan park or accommodation proprietor
- Electricity Transfer Fee Waiver: Waives the connection fee when moving house.
- Off-peak electricity concession: 13% discount on off-peak electricity consumption (mostly used for electric hot water systems and electric floor heating).
The Concessions Unit also administers two grant schemes to assist concession cardholders:
- Utility Relief Grant Scheme: a once-off assistance to pay bills due to a temporary financial crisis.
- Capital Grant Scheme: a once-off grant to repair or replace appliances for households in an emergency situation who otherwise can not afford to do so.
See the DHS website for more
