Energy Trends in 2023 – 2024: How Victorians Can Save On Electricity And Gas Plans

The Essential Service Commission (ESC) has released its quarterly report – the Victorian Energy Market Report – uncovering the current trends in the Victorian energy market. 

On this page, we will cover some of the key takeaways, including how these trends affect your electricity and gas plans and how you can compare energy Victoria to save on your bills.

The areas of the report we will look at are:

• Cost Of Wholesale Power
• Customers Receiving Payment Assistance
• Gas Payment Assistance
• Residential Energy Disconnections
• Third-Party Sales Partners
• New Energy Generators

Who Are The Essential Services Commission?

The Essential Services Commission (ESC) is an independent regulator that works to promote the interests of Victorian residents, in particular the price, quality and reliability of essential services. This includes electricity and gas plans, water and transport.

They are also responsible for the rate-capping system, including the Victorian Default Offer (VDO) to make sure everyone has access to affordable, cheap electricity, and the Victorian Energy Upgrades (VEU) program, which is working towards reducing greenhouse gases through energy efficiency improvements.

The ESC adhere to their responsibilities as prescribed under the Essential Services Commission Act 2001. They undertake several tasks to do this, including:

• Reports on how markets operate
• Compare electricity prices and make determinations
• Compliance and enforcement actions for gas and electric connections
• Compliance assessments and audits
• Approving new market entrants, including new energy generators and electricity providers
• Creating an annual work program to outline key focuses each year

What Is The Victorian Energy Market Report?

Each quarter the ESC publishes the Victorian Energy Market Report to help consumers understand how the Victorian energy market operates. The report looks at energy retailer activity and consumer trends. It includes articles such as compliance and enforcement activity, payment assistance levels, disconnections and market entry and exit activity by electricity providers.

Key Trends In The 2023 – 2024 Victorian Energy Market Report

Some of the key trends identified in the Victoria Energy March 2023 report are discussed below. You can read the full report here: Victorian Energy Market Report

Cost Of Wholesale Power

The record-high wholesale electricity prices in 2022/2023 have impacted the ESC’s decision for the 2023 – 2024 Victorian Default Offer (VDO). The price of the VDO increased by 25% in July 2023, impacting the cost of power for around 400,000 households and 55,000 small businesses.

Customers Receiving Electricity Payment Assistance

The report shows an increase in the number of residential customers accessing tailored assistance from their electricity providers each month, which is unsurprising during the current cost of living crisis. The number of customers accessing assistance for their electricity bill each month has increased by 3 per cent compared to the previous year. 

In addition, the average arrears for customers accessing assistance has also increased by 3 per cent, from $920 to $995. 

In total, 65,584 households were receiving assistance by the end of the reporting period, representing 2.4 per cent of all residential electricity customers.

Tailored assistance could include some, or all, of the following:

• A payment plan for your electric connection.
• Access to rebates or concessions such as the $250 Power Saving Bonus from Compare Energy Victoria.
• Access to a financial hardship program.
• Application for the Utility Relief Grant.
• Information about financial counselling.
• An energy audit to help you reduce your bill and access cheap electricity and gas by choosing the right tariff.

If you need help paying your electricity bills, you should talk to your retailer immediately for assistance.

Customers Receiving Gas Payment Assistance

Gas bills have been hit even harder than electricity bills in Victoria, with the report showing that the number of people accessing payment assistance for gas is the highest it has been since the Payment Difficulty Framework started in 2019. 

The number of households receiving assistance from gas providers has increased by 10 per cent compared to the previous year – a total of  56,466 customers, or 2.6 per cent of all residential gas customers.

In addition, the arrears of customers receiving payment assistance have significantly increased by 9 per cent from $697 to $821.

Residential Energy Disconnections

Residential energy disconnections are a last resort for electricity providers to take if bills go unpaid. There is a strict process that they must adhere to, including helping customers to access payment assistance, before an energy disconnection can occur. 

For this reason, the ESC carefully monitors residential energy disconnections and includes the figures in its quarterly report. 

The report shows that disconnections for non-payment peaked in February 2022 and decreased each month to December 2022. There were 2,372 residential disconnections for the quarter, compared to 1,317 the previous year. There were also 453 small business disconnections, compared to 155 the previous year.

103 customers were reported to have been wrongfully disconnected from energy, across 10 retailers. A wrongful disconnection can occur if the correct process has not been followed by the retailer, or if the customer is protected from being disconnected because they are vulnerable, medically reliant on power or already receiving assistance under the Payment Difficulty Framework.

During the reporting period, retailers paid a total of $125,232 in compensation payments to customers who were wrongfully disconnected.

Third-Party Sales Partners

The ESC is responsible for enforcing and upholding the standards of energy retailers, including any electricity and gas plans sold through third-party sales partners.

In the Victorian Energy Market Report, the ESC disclosed that they have received multiple reports of third-party agents transferring customers’ accounts without the explicit consent of the account holder. The ESC strives to eliminate these instances, with the responsibility placed on the electricity provider to make sure all sales agents, including third parties, are properly trained and adhere to the relevant rules and regulations.

If you compare energy providers with a third party, make sure you choose a reputable, Australian-based comparison company to make sure you are transferred to the best energy plan for your needs.

Energy Market Entry And Exits

Following the energy crisis and record high prices in a turbulent wholesale electricity and gas market, the ESC has increased the scrutiny of new energy retail licence applications in Victoria. This is to protect customers from retailers who are not sufficiently resilient to withstand volatility in the wholesale market.

In the current report, no new retailers have entered the Victoria energy market. There were 230 new electricity providers registered with the ESC for people exempt from electricity licences, such as people selling electricity in an embedded network.

The report shows that there were 3 electricity licences granted to produce electricity in Victoria. The new electricity generators are:

• BESS Longwarry Pty Ltd – electricity generation and sale licence for a 4.95MW battery energy storage system in Longwarry in southeast Victoria. 
• Wangaratta Solar Farm Pty Ltd – electricity generation and sale licence for a solar farm with an output of 33MW, enough to power around 6,500 households every year. 
• Mondo Power Pty Ltd – electricity generation and sale licence for a 5 MW battery energy storage system on Phillip Island. 

How Can Victorians Save On Their Bills

The report shows that Victorians are struggling to pay their energy bills in 2023 – 2024, with the increase to the VDO in 2023 likely to further exacerbate the problem. Three new renewable energy generators have entered the market, which could offer relief in the long run.

If you are worried about the increase in your bills, or struggling to make your quarterly payments, you can try some of these methods to take control of your finances.

• Contact your electricity provider immediately for payment assistance. 
• Reduce energy consumption in your home.
• Compare energy Victoria to make sure you are not paying too much.
• Try to use more energy during off-peak periods to access cheap electricity prices.
• Use your smart meter to track energy and eliminate wastage.
• Install a solar power system

Compare Energy VIC with CheapBills

Our experts are waiting to help you connect now to one of our Victorian energy providers. We can help you compare energy plans and find cheap electricity prices from our preferred suppliers including EnergyAustralia, Energy Locals, BlueNRG, CovaU and Tango Energy. Find out more about our energy providers here or call 1300 786 045 to compare energy today.