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Inquiry into affordable electricity a triumph for community: ACOSS

The Australian Council of Social Service has commended the ACCC on its recommendation for cheaper energy prices

The Australian Council of Social Service (ACOSS) has commended the Australian Competition and Consumer Commission’s (ACCC) inquiry to improve electricity affordability.

The ACCC’s recommendations in the final Retail Electricity Pricing Inquiry report will save the average household between 20 and 25 per cent on electricity, which is a step in the right direction according (ACOSS).

ACOSS acting CEO, Edwina MacDonald, said that access to clean energy is an essential service and is critical to economic participation, health and wellbeing.

“We must focus on improving a person’s capacity to pay bills. Even with reduced bills, people on low incomes will simply not have enough money to afford the basic essentials of life,” MacDonald said.

“We welcome the ACCC’s acknowledgements that we need non-energy market solutions as well as reform across the whole supply chain, requiring a whole of government focus and not just Energy Ministers.”

Energy costs took a blow when the NSW, Queensland and Tasmanian governments permitted an over-investment in network upgrades, pushing billions of unnecessary costs to customers. Queensland and NSW have gouged the worst of the charges.

Policy uncertainty meant companies did not want to invest in new power generators and they took advantage of higher prices to reap more money from Australians.

ACCC Chair, Rod Sims, said the national electricity market is “broken” and added that Australians could not trust retailers to set their own default prices to consumers.

“While important steps have been taken recently, restoring electricity affordability will require wide ranging and comprehensive action,” Sims said.

Key concessions in the report to improve concessions schemes, such as making them means-tested, will target those in need and pave the way for a fairer market.

The ACCC’s affordability measures for consumers also includes improvements to state and territory concession schemes and funding for organisations to assist vulnerable consumers to choose low-paid electricity that suits their circumstances.

With the recommendations also came improvements to funding from state and territory governments for a grant scheme for consumer and community organisations to provide support and assist vulnerable customers and improve energy literacy.

MacDonald said a formal recommendation to support access to energy efficiency for low-income and disadvantaged households was missing, cutting off mandatory energy efficiency standards for rental properties.

ACOSS is also calling for the Council of Australian Governments to fund an independent review to establish benchmarks that energy poverty and affordability can be measured against over time.

“If we are to reap the economic benefits and achieve a more equitable society from the ACCC reforms, strong leadership will be needed and vested interests put aside,” MacDonald said.

“Yes there will be some hard decisions that need to be made but the overall benefits, as clearly stated by the ACCC, should be the higher consideration to achieve equality for low income households in Australia.”

Responding to the report on Wednesday, Prime Minister Malcolm Turnbull said that energy is too expensive and solutions were needed, promising to look at the ACCC recommendations and discuss them with state and territory governments.

“Australians are crying out for an energy policy that is focused on them,” Turnbull said. “They want politicians to cooperate, to deliver an energy policy that is focused on them, and what it means is it’s focused on them paying less for energy.”

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