“If all you are doing is forcing out an artificial concession at a retail level … then all you are going to do is break the market,” he said.
Officials from the Australian Energy Regulator and the federal energy department are seeking feedback from industry participants, including on the design of tariffs, and recognise the need for retailers to make a reasonable return.
Bowen has assured retailers the government will “talk issues through” with companies, but vowed that consumers would be put first. With daytime wholesale prices regularly trading at $0 or plunging into negative territory due to Australia’s world-leading per-person uptake of rooftop solar panels, energy retailers were often “not paying for that energy … and I don’t think consumers should therefore pay their energy companies”, he said.
‘We could end up in a situation where the retailers will be more expensive in non-free times to cover those costs.’
Amber Electric co-founder Chris Thompson
Only a few retailers, including AGL, OVO and Snowy Hydro’s Red Energy, already offer free access to power for some customers in the middle of the day in certain circumstances. Many others, however, have increasingly been rolling out plans built around cheaper daytime rates to run appliances or charge electric vehicles, and financial rewards to store surplus rooftop solar in batteries that can be exported to the grid at night.
Flow Power chief executive Matthew van der Linden said the Solar Sharer offer risked becoming a destabilising intervention in a market in which customers and providers were already heading in the same direction.
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“I would be keen for regulators and governments to be looking for ways to enhance the existing market drivers that are already there, and find a way to reward customers who are taking steps and are participating,” he said.
Amber Electric, a retailer that enables customers to buy and sell electricity at fluctuating wholesale prices rather than fixed rates, said the ability to benefit from vastly cheaper daytime power prices was what it had based its business around for the past seven years.
“It’s cool to see the government moving in this direction,” Amber co-founder Chris Thompson said.
However, he said there were some “question marks” over how the Solar Sharer scheme would be implemented, including whether it would be paired with material changes to network tariffs, and whether those reforms could be made in time for the program’s launch date in July next year.
“We could end up in a situation where the retailers will be more expensive in non-free times to cover those costs,” he said.
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