Energy affordability complaints hits new high: Ombudsman

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Energy affordability complaints hits new high: Ombudsman

By Esther Han

Tens of thousands of families across NSW are being crippled by high energy prices, with mounting arrears, credit listings and disconnections, the Energy and Water Ombudsman says.

The Ombudsman received a record 37,485 complaints in 2013-14, its annual report being released on Thursday shows, with half relating to billing and a quarter relating to affordability.

Energy and Water Ombudsman Clare Petre.

Energy and Water Ombudsman Clare Petre.Credit: James Brickwood

"There's been an increase in the number of people struggling and it's very much to do with the higher prices for what is an essential service. People don't have a choice," Ombudsman Clare Petre said.

"There's lots of pressure on low-income households, people with fixed incomes, people who have very little financial flexibility."

NSW chief executive of St Vincent de Paul, Michael Perusco.

NSW chief executive of St Vincent de Paul, Michael Perusco.

Ms Petre said complaints surged, despite the levelling off of price hikes in July last year. The "long tails" of the huge hikes – largely driven by over-spending on poles and wires and, to a lesser extent, the carbon tax – in the previous four years were still having an impact on consumers.

Affordability-related complaints surged by 28 per cent in the past year, with the largest jumps linked to declined payment arrangements, up 64 per cent, and impacts on credit ratings, up 53 per cent.

Among billing complaints, issues about back-billing, a catch-up bill for energy use that has not been correctly charged in the past, rose by 90 per cent and billing errors increased by 47 per cent.

"Even though from last July the increases were less than the consumer price index, as opposed to 18 per cent in previous years, the long tails from price rises mean we're not out of the woods yet," Ms Petre said.

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Complaints about disconnections because of non-payment rose by 32 per cent to 1702, which was "very high", she said. "It's gone back up to rates I haven't seen in many years."

There were 25,900 electricity disconnections in NSW for the first nine months of the past financial year – a thousand more than the previous 12 months – according to the Australian Energy Regulator.

Michael Perusco, said reversing disconnections cost too much for most low-income families already laden with other bills and rent, resulting in homelessness.

Last year the society handed out $5 million to cover energy costs for needy families – a 10 per cent increase on the previous year.

The charity is demanding reforms to the flat rebate provided by the state government.

"We think it needs to be a rebate based on the percentage of the bill, so that it takes into account family usage as well as regional customers who pay more for their electricity," he said.

Ms Petre, who is stepping down from the role she has held for nearly 17 years, is concerned too many households have not taken up the government's rebate offers despite eligibility.

"There are deals to be had and savings to be made, but the market's still challenging and confusing, and many people do feel intimidated," she said.

More than half the complaints related to billing, which as a category increased by 7 per cent. The main issues were high or disputed accounts, billing errors, tariffs and back-billing.

In the past year, Origin Energy angered the largest number of customers, with 12,514 complaints raised against it – about half linked with billing. In second is Energy Australia, with 9665 complaints, again largely to do with billing complaints.

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