Climate Change Energy efficiency General Ride The Talk

Smart meters –> energy price rises

Recently, in our street in suburban Melbourne, we have had “smart” meters installed. The program of smart meter installation has been legislated by the Victorian Government – you don’t have a choice about whether you get one or not; it will come to you. Last week I received a letter from my retailer, Origin, flagging “Time-of-Use” (ToU) energy prices. For the vast majority of us, this will result in major increases in bills.

My “peak” rate went from 28.424 to 39.149 cents per kilowatt-hour. The “off-peak” rate was flagged as 14.674 c/kWh BUT this operates from 11pm – 7am! (Granted that they also include the weekend in the “off-peak” times, I still don’t believe you will make up the difference.)

As a result, you will probably pay more; LOTS more. Don’t be fooled by the low off-peak rate; unless you use a LOT of energy between 11pm and 7am, you won’t see much benefit. The “peak” times are the times when most of us use power. That’s why they have them classified as “peak”.

The state government has mandated that you can request that you be taken off ToU prices and move back to your old “flat rate” pricing. This has not received much publicity and is certainly not mentioned in the letter I received from my retailer.

At Origin you need to call 13 24 61 and ask for the “Customer Resolutions Department”. Other retailers have the same mandate upon them but the name of the department may differ.

We have been paying a premium for many years now in order to have 100% GreenPower …and will continue to do so. This is a worthy addition to try to mitigate the GHG emissions created by the production of the electricity that drives our modern lifestyle.

Smart meters have a role to play in reducing GHG emissions but more through the education role they are able to provide – not from price gouging.

2 replies on “Smart meters –> energy price rises”

Thanks John,

It’s worth noting that the majority of customers (60-80%) are expected to be better off or the same with time of use pricing than with flat tariffs. This number gets higher of course when you take into account savings from shifting load away from peak times.

Having said that, a number of houses that use little energy overall will not be able to save as much as the ~$100/year extra they are paying for the privilege of having a smart meter in FIXED charges.

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Unfortunately, this is not the case when the “peak” hours are 7am – 11pm and “off-peak” 11pm – 7am. How many people can benefit from using energy when they are asleep?

Also the tariff increase for “peak” use was a whopping 37.7% !!! Granted the “off-peak” had a discount of 50% but I am unlikely to use much energy during the wee small hours of the morning – fridge excluded of course. I agree it “could” work to make for more equitable pricing structures but this first attempt by my retailer was anything but equitable.

When the moratorium is over, unless the retailers make a better fist of their peak/off-peak rates and the times they operate, they will find many people with raised fists over the price gouging that results. This may not necessarily be a bad thing, however, as it may drive people to disconnect from the grid completely and use solar & batteries to provide themselves with their own energy without having to contribute to the coffers of our vertically integrated gentailers.

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