Energy retailers on notice over prices

Karen Sweeney
A national energy report claims Australians trust their banks more than their power retailers

Energy retailers are on notice that unless prices come down the federal government will intervene.

The threat was made by Energy Minister Josh Frydenberg after a new reported revealed community trust in the sector had plummeted.

Just 39 per cent of Australians believe energy retailers are trustworthy, down from 50 per cent last year.

A report by the Australian Energy Market Commission says Australians believe they get more value for money from their banks and internet providers than their electricity retailer.

"My message to the retailers is unless they get prices down and they pick up their act you will see more (government) intervention because that's what the public will demand of their political leaders," Mr Frydenberg told ABC radio on Friday.

The government's proposed National Energy Guarantee is a way to avoid that intervention but also stabilise the market and decrease prices, he said

He admits hyper-partisanship has delivered uncertainty until now, contributing to higher prices.

He also blames low trust on the fact people find their bills too complex and discounts hard to compare or highly conditional.

"And you only get a better deal from your energy retailer when you threaten to leave, so in fact the retailers are rewarding disloyalty instead of the loyalty of their long-term customers," he told ABC radio.

Senior Labor MP Anthony Albanese said policy uncertainty over five years had led to a lack of investment in renewables, driving prices higher.

"They have had a war on renewables. What that led to was uncertainty, a lack of investment and higher prices as well as higher emissions," he told the Nine Network.

The AEMC quotes a customer survey in April which found just 45 per cent of customers felt positive they were getting value for money from their electricity provider.

"While prices are now flatter or falling, we are disappointed to see retailers are still not doing enough to help their customers," AEMC chairman John Pierce said.

That compared to positive results of 57 per cent for gas services, 61 per cent for internet services and 70 per cent for banks.

Mr Pierce believes there's nothing stopping retailers being more innovative or cost competitive, but they've been slow to act and consumers who can afford it are increasingly turning to do-it-yourself power alternatives like rooftop solar panels.

Almost two million households are using residential solar power sources - a number he expects will continue to rise.