News State QLD News Energy market heats up as retailers fight to out-discount each other

Energy market heats up as retailers fight to out-discount each other

Some energy customers are enjoying the benefits of "under the table" deals from retailers.
Some energy customers are enjoying the benefits of "under the table" deals from retailers. Photo: Getty
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Savvy consumers are scoring secret deals on electricity, saving hundreds of dollars on power bills while unknowing customers are stuck on higher fees.

The arrival of energy retailer Alinta and its 28 per cent discount in Queensland has led to rival providers offering “under-the-table” power plans to customers who know how to put the heat on.

Street-smart buyers who drive a hard bargain are making significant savings by obtaining special discounts on top of the advertised discounts already offered.

Customers are also being lavished with free gifts worth hundreds of dollars, such as fitness watches and tablets, and lured with free power connections.

The so-called “off-market” deals are not common knowledge because they are not advertised, promoted nor routinely offered unless consumers are savvy enough to probe deeper and work the system.

In one example, Origin Energy has been offering select clients its so-called Bill Saver Plus plan – but only if it might lose the customer to another retailer, or a new customer appears reluctant to sign on.

The Bill Saver Plus offers 21 per cent discount off the ‘supply’ component of the power bill (poles and wires) on top of the standard 21 per cent discount on electricity usage.

Amaysim has been giving away free Samsung watches and tablets to new electricity customers and offering to connect households at no cost on top of its advertised 20 per cent discount.

How to get the deals

St Vincent de Paul’s Queensland tariff tracking project revealed the average household on standard power rates (using 8000kWh per year) is about $425 worse off than households on market deals, including pay-on-time discounts.

Queensland household energy debt was 5.6 per cent of the total household budget in 2017.

Consumer advocates have urged people to get educated on power bills and “put the heat on” their power provider to secure the best offer.

“Our advice is to tell your provider you are thinking of switching to Red Energy or Alinta, which will usually trigger the ‘retention team’ where they may offer you a deal,” Queensland Council of Social Services project officer Fiona Hawthorne said.

“Electricity is a business. They will try and get away with charging you as much as they can unless you can work out how to get around that.”

St Vincent de Paul social policy unit Victoria manager Gavin Dufty said the so-called “under-the-table” or “below-the-line” deals were not offered to everybody.

“Savvy” customers can save hundreds of dollars on their energy bills – they just have to ask. Photo: Getty

“If you put the heat on them, they will give it up. But if you don’t put the heat on them, they won’t do anything,” Mr Dufty said.

“It’s the same tricks you use when you go shopping except we’re not used to it in energy because no one has trained us how to shop smart.”

Mr Dufty said retailers were equally keen to get rid of customers who caused too much trouble for call centre staff and did not pay bills on time.

“The best way to get the deal is to call up and be nice, fish around and ask them if they can match the price,” he said.

“They might offer you the better deal because they like you. Don’t yell at call centre staff or they won’t want you because you are an extra cost.”

Smoothing out the market

The federal government has requested the Australian Energy Regulator  begin work on developing “default market offer prices” to ensure consumers who don’t shop around have access to fairer prices.

“Default market offer prices will also be an input into the development of reference bills that will be used by retailers to calculate and advertise their discounts,” AER chairwoman Paula Conboy said.

“This will make it much easier for consumers to compare offers between retailers and find better deals.”

Consumers are encouraged to compare tariffs and discounts on the AER’s Energy Made Easy website.

“I encourage consumers to shop around where they can to get better energy deals, including by contacting their existing and other retailers to ask about their best deals,” Ms Conboy said.

An Origin Energy spokesperson said: “We work hard every day to compete to win, retain and save customers with a range of competitively priced plans, products and services to meet different customer needs”.

“We encourage customers to contact us at any time to discuss their energy needs.”

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