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How seniors would benefit from ACCC’s proposed energy revamp

The average household will save between 20 and 25 per cent on their energy bill if the recommendations of an electricity affordability report are adopted, say its authors.

The Australian Competition and Consumer Commission (ACCC), releasing its Retail Electricity Pricing Inquiry Report on Wednesday, said the national electricity market is “largely broken and needs to be reset”.

ACCC chair Rod Sims said it’s clear that most households are paying far too much for electricity. “In addition, some of the most vulnerable in our community are forced to struggle through freezing winters and scorching summers, with many others also having difficulty paying their bills,” Sims said.

COTA Australia said in the ACCC report that older Australians, particularly retirees on age pensions, are struggling with the rising cost pressures.

Yates said prices are forcing them to cut spending in other areas such as health.

The ACCC said there are many reasons Australia is facing electricity affordability issues. Sims said: “Wholesale and retail markets are too concentrated. Regulation and poorly designed policy have added significant costs to electricity bills. Retailers’ marketing of discounts are inconsistent and confusing to consumers and have left many consumers on excessively high ‘standing’ offers.”

Of ACCC’s recommendations, COTA Australia was particularly pleased to see the proposed nationally consistent means-tested approach to concessions and the introduction of a hybrid fixed and percentage rate.

“The implementation of a hybrid fixed and percentage rate would ensure that concessions are better suited for low usage consumers like older Australians living alone and higher usage consumers like families,” Yates said.

COTA Australia also welcomed the recommendations surrounding improved comparability of energy prices and Government investment in energy literacy programs for vulnerable populations.

Yates said: “Older Australians are bombarded with various electricity plans and often don’t know how to work out which one is best for them – programs that ensure older Australians are equipped with the skills and resources to make an informed choice when it comes to their energy provider are greatly welcomed.”

Sims said restoring electricity affordability will require wide ranging and comprehensive action. “We believe our changes can and will, if adopted, have a powerful and tangible impact on electricity affordability for all Australians; this will reduce economic inequality and enhance our national welfare.”

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