Report shows Victorians missed out on millions of dollars in energy bill savings last financial year
26 September 2023
Victorian households could have saved an estimated $191 million on electricity bills and $89 million on gas bills last financial year if they had been on their retailer’s best offer, according to data from the Essential Services Commission’s latest Victorian Energy Market Report.
The report provides analysis of prices and competition in Victorian retail energy markets, key compliance and enforcement activities, data on customers experiencing payment difficulties, disconnections, and market entry and exits over the reporting period April to June 2023.
Key findings include:
One in two Victorian residential electricity consumers were on their retailer’s best offer in 2022-23 while 70 per cent of residential gas consumers were on their retailer’s best offer.
28 per cent of Victorian residential electricity customers could have saved $100 or more last year by moving to their retailer’s best offer.
Some households could have saved a lot more – around six per cent of Victorian residential electricity customers could have saved between $250 and $400 last year. A further six per cent could have saved over $400 last year.
17 per cent of Victorian residential gas customers could have saved $100 or more on their bill last year by moving to their retailer’s best offer.
Victoria’s largest retailers, which cover more than 80 per cent of Victorian residential electricity customers, have the lowest proportion of residential customers on their best offer, with only 42 per cent on their retailer’s best offer over 2022-23.
Around 64 per cent of small to medium businesses were on their retailer’s best electricity offer and 72 per cent were on the best gas offer.
“There are simple things Victorians can do straight away to save on their energy bills,” advised Commissioner Sitesh Bhojani. “The first step is to check your energy bill to see if you’re on your retailer’s best offer. If not, make the switch with your retailer. This is often easy. Some retailers offer customers the ability to change to the best offer or plan online.”
A retailer’s best offer is typically the cheapest generally available offer and does not include one-off gifts or sign-up credits. It’s based on how much energy a customer has used over the past year. Energy retailers are required to regularly communicate their best offers to customers. Retailers must tell customers via their energy bills – every three months for electricity bills, and every four months for gas bills – if they’re on the best offer, and how much they could save by switching.
“Look for the box on the front of your bill that says,‘could you save money on another plan’. This isn’t a marketing ploy. Under the rules, retailers in Victoria must regularly tell you their cheapest energy plan available based on how much electricity or gas you currently use,” Commissioner Bhojani said. “But customers don’t need to wait for a bill, check with your retailer if you’re on their best offer.”
Commissioner Bhojani says customers need clear, timely and transparent information about energy offers to engage confidently with the energy market.
“As part of our energy compliance and enforcement priorities, the commission has a proactive best offer information compliance monitoring program underway. This looks at how retailers comply with their obligations to communicate best offer information so that customers can clearly identify the best offer information on their bill and understand the actions required to switch. We are also developing a guideline for retailers to improve how they communicate their best offer to make it clearer and easier for customers to switch to a better value plan.”
The report shows the gap between the cheapest and most expensive electricity offer is the largest it’s been in the past three years. There are also significant differences between the highest and lowest priced gas offers.
“This means there are potential savings for Victorians who shop around for a better energy offer. Review your energy bills regularly, check you are on your current retailer’s best offer, and use tools like the Victorian Energy Compare website to compare offers in the market.”
Commissioner Bhojani said if Victorians are having trouble with energy bills, help is available.
“We want Victorians to access the support they are entitled to under the energy payment difficulty framework. This is an important consumer protection that entitles residential customers facing bill stress to payment assistance from energy retailers, as well as advice about hardship programs, utility relief grants and other concessions.
“The right help, and the earlier the better, can make a big difference. If you’re having trouble managing your energy bills, don’t delay. Contact your energy retailer today to access the payment assistance you are entitled to.”
Figure 1. Share of Victorian residential electricity consumers, by saving amount from being on the best offer in 2022-23
Figure 2. Example of retailer best offer information – look for the box on your bill that says ‘could you save money on another plan?’
