Post 13 – Electricity Retailers and Prices

Following my relatively recent decision to buy all our electricity from renewable resources only (green electricity) and from companies that do not have ownership in, are partly owned by or invest in fossil fuel, I left the electricity retailer that I had been with for the last five years. I probably would have made this change earlier but I was concerned, amongst other things, about the effect on our feed in tariff from our solar system. So, for a person who is committed to doing her best as an individual and as a member of a household to mitigate the effects of climate change, why did it take me so long? As with many things, small and large, significant and insignificant, there are usually a number of reasons, as is the situation in this case.

Right here, at the start of this post, I have to say that cost was an issue. Presently, it costs more per kilowatt-hour (kWh) to buy ‘green’ electricity (see below) than ‘standard’ electricity’ but I decided that it was a necessary cost. My conversation with myself went something like this. Do I really believe climate change is occurring? Yes. Do I believe it threatens our existence and lifestyles? Possibly and definitely. Do I think I have a personal responsibility to do as much as I can about it? Yes. So, why don’t I buy green electricity? Wriggle, squirm followed my more wriggling and squirming with a quick tour of self-justification along the lines of ‘well, I am trying to ensure the household uses as little power as possible and we have solar panels on the roof’. Hmmm I say to myself, hardly good enough, you need to put your money where you mouth is. And so I did. We had, at various times in the past, purchased 100% green electricity and various other percentages of green and standard electricity but it was often tied to a better household income but not anymore. We will not use electricity that adds to global warming.

For those who are interested, here are the different rates:

Old retailer peak & off-peak rates for electricity = $0.34 (exc GST)/kWh & $0.16 (exc GST)/kWh
Old retailer peak & off-peak rates on green electricity = as above plus an additional $0.04 (ex GST)/kWh making the prices $0.38 and $0.20 but including GST this makes it $0.42 (peak) and $0.22 (off-peak).
New retailer peak & off-peak rates vary with the time of year but for the last few weeks their green price including GST has been $0.41 (peak) and $0.20 (off-peak).

I am sure that some people reading this (I can now say that it looks like my readership is averaging six people a week and peaking at nine, up from three and a cat) will note that they have cheaper rates. I can promise you that I have done a lot of homework on this and have yet to find anything that is available in this area, cheaper, offers time of use and meets my criteria about ownership. Anyway, it looks like I have made a move that will be about the same as staying with my old retailer while fulfilling my criteria about no ownership in fossil fuel organisations. The retailer I have chosen is Powershop, which I heard about from Environment Victoria who get a few cents a kWh back from Powershop if you buy a particular Powershop product which I am currently doing. I am, however, looking at another electricity retailer Meridian Energy (parked) that a friend told me about and which is linked to the Tasmanian hydroelectricity scheme. This may be an even better option but I will decide after I have had my first summary account from Powershop (parked) and can explain more about how it really works.

Having covered the cost issues that delayed me committing to 100% green electricity, and a company that was not linked to fossil fuels, one of the other issues that held me back was our solar panels and the associated feed in tariff. As I have said in earlier posts, we have a 1.5 kW system which we were lucky to install at the time when the government was offering $0.66/kW as a feed in tariff. This means that for every kW of electricity we export to the grid, we are paid $0.66. This also means, for us, it is possible to pay less than $50 to our electricity retailer over the six month period from about November to April. Depending on who you talk to, people will say, as they did to me, ‘Oh, you can’t change electricity companies because you will lose your $0.66.’ More issues related to money but this issue is about more than that; it’s about time. It sounds silly as I write it now but I wasn’t sure what feed in rate we were on – look at your power bill was my initial response to myself but it turns out, our old retailer just put a single line on the invoice saying ‘solar contribution’ and a dollar amount. More recently, they have been showing the meter reads for exported electricity but you still have to do the math to work out what your feed in tariff is. Possibly other retailers are different (better). Anyway, having established that we were getting $0.66 for electricity feed in, I then needed to sort out the question of whether or not we would lose that rate if we changed retailers. Now this change has been a work in progress off and on for about 12 months but 12 months ago, when I searched the internet for information about feed in tariffs and what happens if you change retailers, I could find very little that was reassuring. Now things are different with a nice government website making everything clear. The bottom line in Victoria is that there are three feed in tariffs that are linked to closed schemes (new people can’t participate) and the is the current feed in tariff is $0.06 per kW. Everyone who puts on panels now gets $0.06/kW for 2015. There has been some talk of it dropping even lower in 2016. The premium tariff, which is part of a closed scheme, pays $0.66 kW and the scheme lasts until about 2023 and you can change retailers whenever you want; the other two tariffs, that are also part of closed schemes end in about 2016 and pay something like what is called the ‘going’ retail rate for electricity and you do lose access to this tariff if you change retailers. We are certainly lucky to be in the scheme we are in but it took me quite a long time to work all this out and to find the actual contract document we have, related to the installation of our solar system, and to verify my understanding against that contract. So, all up, I find trying to understand the retail electricity market complex and time-consuming but, to try to understand the wider electricity industry, which I am attempting to do, is almost overwhelming. I will close for now encouraging people to consider buying ‘green’ electricity from a retailer that is not linked to the fossil fuel industry. Bye for now, Jane