This message first appeared in our November 2024 newsletter. To stay up to date with the latest news and research on energy issues that impact consumers, sign up to receive our monthly newsletter today.
Read last month’s message here.
I’ve recently ticked over my first anniversary at Energy Consumers Australia. Some of what I’ve experienced is exactly as I’d expected, while other things have surprised me. Examples of each are below.
There seems to be an enormous amount of collective goodwill and – despite much of the rhetoric – I suspect there is quite a bit more that people agree about, than not. Naturally, in a ‘grievance rich’ era, we hear more about the conflicts than the collaborations, but I still think the future lies with the latter. I don’t want to appear naïve, because I know there are still major disagreements, but I have seen some real wins where parties have put community interests over their own. More of this please!
Another real positive is the sheer number and weight of ideas being generated by deeply clever people to address energy problems. There are so many proposed technical solutions that it makes my head spin sometimes – and I can only admire the people tasked with trying to fit these innovations into the current regulated system. How we’d enjoy seeing the same creativity and blue sky thinking in energy pricing and concessions…
Notwithstanding the above, there are a few issues that haven’t moved much over the year. Sometimes we spend far more time “admiring the problem” which, while understandable, won’t get us very far. Consumers want to know, for instance, what the future of the gas network will be, and what will be done at scale to improve energy efficiency of homes and businesses (and thus reduce their bills).
I’ve also been reminded that the community is reliably clever. In a time of cost pressures, it’s no wonder that energy prices are a sensitive topic. Interestingly, though, consumers seem pretty cluey when asked what they think the future holds. Our recent survey (to be released next week) found consumers evenly split on whether renewables will bring prices down in the short term – but roughly twice as many see renewables leading to lower bills in a few years’ time. This aligns very closely with recent analysis by the AEMC, which suggests residential prices could fall by 13% in a decade, if the renewables roll-out proceeds as anticipated.
One thing that has really struck me is the number of complex cross subsidies in the energy system. Of course, these are found in every consumer goods or services sector. But they seem less well acknowledged here. I fear that as the energy transition gathers pace, we will see even more trade-offs between consumers.
Once upon a time, much of the regulatory imperative was determining a workable equilibrium between the interests of commerce and consumers. This exists in energy, too, but increasingly the challenge will be determining “winners and losers” between consumer cohorts – e.g. those who generate/store their own energy and those who can’t, those who electrify and those who don’t, those who own and those who rent, those who can shift consumption off-peak and those who can’t. Resolving these tensions will require the wisdom of Solomon, but has to be done. ECA will be active in these conversations.
There are several other observations I’ll keep for another day. Suffice to say: none of us will run out of work anytime soon. And for all of you who have welcomed me back to the sector so warmly, you have my thanks.
Brendan French
Chief Executive Officer
