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ABC News
ABC News
Business
energy reporter Daniel Mercer

Confidence collapses as desperate consumers vent fury at failing National Electricity Market

Energy price hikes are threatening to send Ian Davies' fabric printing business to the wall. (Supplied: Ian Davies)

For Ian Davies, the run of ill-fortune over the past few years has been almost too much to bear.

First there was the banking royal commission that limited the amount of money he could borrow to expand his Sydney-based fabric printing business.

Then there were the COVID-induced lockdowns that slashed demand for his products.

And, finally, there was this year's energy crisis, which has brought yet more misery for his company, somewhat ironically called Think Positive Designer Prints.

"The immediate problem is our electricity supplier has just more than doubled our payment plan with two weeks' notice," Mr Davies said.

"Now that's $100,000 a year in electricity, and we just don't use that. How they worked this out I've got no idea.

"I've phoned these people up, the suppliers up, and they said 'well, that's all worked out automatically and that's the way it is'.

"And if we don't pay the weekly payment, they'll just cut us off."

'We've got a trust problem'

Like millions of other Australians, Mr Davies has grown increasingly frustrated with an electricity system he says is failing to deliver for users.

Disruptions to Australia's fleet of coal-fired power plants have helped propel prices to record highs. (Shutterstock: Kip Scott)

It is a theme borne out by the latest six-monthly survey by the body that represents household and small business electricity customers, Energy Consumers Australia (ECA).

The survey, which has been running since 2016, found that faith among users in the electricity system was collapsing amid a crisis engulfing the country's biggest market.

The chief of ECA, Lynne Gallagher, said consumers valued affordability and reliability above all else, but the failures of the National Electricity Market meant they could take neither for granted.

"We've got a trust problem," Ms Gallagher said.

"We've seen double-digit price increases being announced, we've had retailers saying that they don't want their customers staying with them, we've had people being worried that the power is going to go out on a cold winter day and a cold winter night.

"The outcome of all of that is only four in 10 Australians say they have confidence that the energy market is acting in their interests."

Lynne Gallagher from Energy Consumers Australia says people are understandably angry. (Supplied: Energy Consumers Australia)

According to the survey, to be released this morning, 88 per cent of those questioned were "highly concerned or somewhat concerned" that energy would become unaffordable over the next three years — a marked jump compared with earlier results.

Need for solutions pressing

People were even more concerned for the broader public, with 94 per cent of respondents worried energy would be unaffordable for others during the next three years.

Ms Gallagher said the findings should serve as a wake-up call for those overseeing the system.

For starters, she said much more needed to be done to make Australian housing more efficient, likening the current standards to those of a tent.

Longer-term, she said safeguards such as a capacity market — which would pay providers to ensure they were available when the system needed them — were essential.

"The focus for policymakers has to be on ensuring that the investment that's needed in the future energy system — that's in large-scale generation assets, in storage, in transmission — is efficient, that we're fully utilising the capacity of all of those assets," Ms Gallagher said.

"When you have a renewable energy system you have plenty of solar in the day and pretty much plenty of wind overnight.

"But the real challenge is that gap when you don't have solar and you don't have wind.

The Australian Energy Council, which represents big power providers, said an unprecedented coincidence of events had driven the increases in wholesale prices.

A spokesman for the group noted spot prices had jumped 141 per cent in the 12 months to the end of March as coal and gas costs soared.

The spokesman said charges would vary according to the retailer but consumers were always urged to shop around for a better deal.

'Things don't look bright'

The number of Australian homes with solar is expected to double in the next 10 years from three million today. (Supplied: Project Symphony)

Small business owner Ian Davies was not optimistic about the road ahead, claiming the latest price hikes were a cruel blow that could well send his business to the wall.

He had invested all of his life savings into what he says is an exciting technology, but he was worried energy costs could be the straw that breaks him.

"I rang them straight away and said 'look, I'm almost in tears, I can't take much more, surely this is a mistake'," he said.

The 65-year-old said he had little faith in the energy system, but he had even less in the politicians whose job it was to provide a solution.

He noted that Australia was grappling with acute gas prices even though the country was one of the biggest producers in the world — a situation he described as absurd.

"Energy is critical to manufacturing and we're a small manufacturer," Mr Davies said.

"I'd love to put a bunch of solar panels on the roof but where am I going to get the money for that? So, things don't look bright.

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