Energy retail price offers comparison report 2020-21 & supplementary electricity retail price offers comparison report 2020
29 Aug 2021
The Energy Retail Price Offers Comparison Report 2020-21 reports on electricity and gas retail offer prices that were generally available to residential and small business customers during the period 30 June 2020 to 30 June 2021.
The Supplementary Electricity Retail Price Offers Comparison Report 2020 was developed in response to an information request from the South Australian Minister for Energy and Mining to examine the prices for the sale of electricity in South Australia following the introduction of the Default Market Offer by the Australian Energy Regulator on 1 July 2019.
Under the Electricity Act 1996 and Gas Act 1997, the Essential Services Commission (Commission) provides to the South Australian Minister for Energy and Mining (Minister) an annual Energy Retail Price Offers Comparison Report.
The Energy Retail Price Offers Comparison Report 2020-21 discusses electricity and gas retail offer prices that were generally available to small customers (residential and small business) during the period 30 June 2020 to 30 June 2021.
The key observations of the Report are that:
- Average residential annual electricity retail Standing Offer and Market Offer prices fell by 5.9 percent and 7.0 percent respectively over the 12 months to 30 June 2021. Average small business annual electricity retail Standing Offer and Market Offer prices fell by 8.0 percent and 7.5 percent respectively over the same period.
- Average residential annual gas retail Standing Offer prices fell by 3.7 percent, but average annual retail Market Offer prices increased by 0.1 percent over the 12 months to 30 June 2021. Average small business annual gas retail Standing Offer and Market Offer prices increased by
0.6 percent and 0.2 percent respectively over the same period.
- There was a wide range of discounts between electricity retail Standing Offers and Market Offers. For residential customers, the discount between a retailer’s Standing Offer and average Market Offer ranged from no discount to 19 percent. For residential gas customers, the discount between a retailer’s Standing Offer and their average Market Offer ranged from no discount to 26 percent.
- There was potential for small customers to reduce their annual energy bills by moving from Standing Offers to Market Offers or, if already on a Market offer, by considering alternative Market Offers. Customers can use the Australian Energy Regulator’s (AER) Energy Made Easy website to compare all available offers.
In September 2019, the Commission received an information request from the Minister to produce a Supplementary Electricity Retail Price Offers Comparison Report pursuant to the Electricity (General) Regulations 2012.
The information request requires the Commission to examine the prices for the sale of electricity in South Australia following the introduction of the Default Market Offer (DMO) by the AER on 1 July 2019, by considering the prices of electricity retail Standing Offers and Market Offers.
The key observations of the Report are that:
- The weighted average retail Standing Offer and Market Offer prices for both residential and small business customers were lower at 31 October 2020 when compared to 30 June 2020.
- Retailers increased the range of electricity retail offer prices available as at 30 June 2020 and 31 October 2020, compared to corresponding dates in 2019. The majority of retailers set retail Standing Offer prices either at or just below the DMO price as at 31 October 2020.
- The majority of residential and small business electricity retail Market Offers were still priced below the DMO as at 31 October 2020. Both the price range and available discounts had also generally increased, when compared to retail Market Offers publicly available on 30 June 2020.
- For residential customers, the number of customers on retail Standing Offers was broadly unchanged. In terms of the distribution of customers across price bands, the majority of customers were on the lower annual bill price bands for both retail Market and Standing Offers.
- For small business customers, there was an increase in the proportion of customers on retail Market Offers. In terms of the distribution of customers across price bands, the majority of customers were on the lower annual bill price bands for both retail Market and Standing Offers.
Although it is too early to draw any enduring conclusions about the impact of the DMO price on electricity retail prices in South Australia, there is evidence of growing price and product competition (as evidenced by the increased range of retail electricity offers and discounts as at 31 October 2020 compared to 31 October 2019). The impact of the DMO on the South Australian electricity retail market should become clearer over a longer period of time.