Seniors big losers in power market

A new energy market report has reinforced the need for regulated power prices for older consumers unable to shop around for a better deal, National Seniors Australia said today.

National Seniors’ Chief Advocate Ian Henschke said the Australian Energy Market Commission (AEMC) report found higher prices combined with complex and confusing energy offers had driven consumer confidence to new lows.

“The report cites complex pricing plans, conditional offers, discounts from bases that vary by retailer, and an increasing trend towards discretionary win-back marketing as the reasons for consumer confusion and dissatisfaction,” Mr Henschke said.

“Unsurprisingly, the AEMC report found that trust in the energy sector dropped from 50 per cent in 2017 to 39 per cent in 2018.”

Mr Henschke said while it was hoped deregulation of the retail electricity and gas markets would lead to better prices for consumers, the opposite had occurred, and vulnerable seniors often found it difficult to shop around for a better deal.

“The proliferation of complicated and complex offers makes finding the best deal challenging,” Mr Henschke said. “In many instances, older consumers have found themselves worse off because the terms and conditions of market offers are confusing, misleading or difficult to compare.

“Their limited access to the internet and poor digital literacy mean many older people are not even able to access online comparison websites or those of the power companies.

“It’s no wonder that many older people choose to stick with standing offers.”

Mr Henschke said research had found many consumers didn’t bother to switch because they found it too confusing or didn’t believe it would make a material difference to what they paid.

As the AEMC report released today highlighted, consumers who didn’t shop around or stayed faithful risked being hit by a “loyalty tax”. 

“Regulated energy offers for electricity and gas that sets terms, conditions and prices would reduce the risk of vulnerable older people paying more for energy than they should,” Mr Henschke said.

Ian Henschke is available for interviews on 0418 815 319.

Media contact: Lynda Schekoske (07) 3233 9106 or 0488 047 380.

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