Regional Australian’s Struggling to Pay Energy Bills

21 OCTOBER 2019: A recent news report released by the ABC has found that a growing number of regional Australian’s are struggling to pay their energy bills. This has, in turn, resulted in tens of thousands of homes having their electricity disconnected because of unpaid bills.

While it’s easy to point the finger at increasing energy prices, a team of researchers evaluating disconnection data believes that the surge in disconnections is actually being caused by a range of issues. Regional Australian’s are faced with lower wages, while also tackling unique difficulties such as drought, job shortages, an aging population, and inadequate welfare payments.

The fact that disconnection rates are higher in regional areas was supported by another recent study contracted by St Vincent de Paul Society with the aim of mapping electricity disconnections across a three year period (2015-2018). Gavin Duffy from St Vincent de Paul Society was unsurprised by the findings of the study. “Regional and rural areas tend to have higher electricity costs simply because the poles and wires part of the bill is higher than the metro areas,” he stated. When coupled with lower wages, higher rates of unemployment and an older population, it’s no wonder that households are finding it increasingly difficult to pay their energy bills. “You have income pressures, higher cost pressures … something’s got to give, and in these cases, it’s electricity getting disconnected.”

These issues are compounded in regions that have experienced a downturn in the local industry. For example, before its closure in early 2017, the Hazelwood power station in Victoria’s Latrobe Valley had almost 500 employees and worked with around 300 contractors. But many others in the community also relied heavily on the power station, including the local food service industry and those that manufactured parts or products used in running the power plant. Many in the Latrobe Valley have suffered financially since Hazelwood’s closure, with over 9% of households in the region’s two biggest towns experiencing power disconnections during the study timeframe.

The Australian Energy Council maintains that power disconnections should only ever occur as a last resort, so why is this issue affecting so many Australian’s? Unfortunately, many consumers have adopted a “head in the sand” approach to dealing with high electricity bills. They hope that ignoring calls from their energy provider will buy them more time, but this is never a good idea according to Sarah McNamara, CEO of the Australian Energy Council, as a provider can order a disconnection after just two failed attempts at contact. Instead, she recommends going on the offensive and calling the energy provider as soon as possible to advise of financial hardship. Once a customer has taken this step, the energy retailer is obliged to offer them assistance, often in the form of an agreed-upon payment plan.

Many households that are struggling to pay their energy bills may also find that an alternate provider can offer a better deal. By utilising a free online energy pricing service, many may be able to take proactive steps towards lowering their energy bills.

 

Author: Bec Wilkinson
Bec Wilkinson is an ElectricityComparison.com.au News Contributor from Melbourne, Australia. Bec is a founding member of the Electricity Comparison news team.