@mark_m. From what I’d read - see my earlier postings - demand tariffs were due to be the standard in Queensland for everyone with a smart meter from 1 July 2021. I was surprised, but certainly not disappointed, when AGL for one doesn’t seem to have made demand tariffs mandatory as yet. I agree that a mixture of tariff structures does seem unfair, but it’s only a matter of time before they get imposed on all of us anyway.
In principle, I’m not opposed to demand tariffs, particularly since there’s a decreasing proportion of despatchable power being fed into our network and they have to do something to stabilise it by flattening the demand curve.
Two things bother me, however. Firstly, the demand tariff structure is unnecessarily complicated, and somewhat unfair also. Why, for example, does it have to be imposed on public holidays when demand is otherwise low? Because it’s so complicated, most people won’t understand how it is calculated, which will reduce its effectiveness. I’d really like someone to explain to me why it is preferable to having time of day tariffs which are so much easier to understand.
My second concern is that householders are being encouraged by means of publicity and Renewable Energy Certificates to install rooftop solar while at the same time feed-in tariffs are being reduced and there’s now talk of actually charging households when they try to export solar power at times of excess supply. The left and right hands seem to be fighting each other.
I seriously believe a good approach would be for the Federal Government to phase out RECs for solar generation and reallocate that money to subsidise the installation of household storage batteries. Those batteries could be set up so that they get charged from solar panels and/or the supply grid at off-peak times and for their power to be available only during the 4pm to 9pm peak demand time. Surely, that would be more effective and would go quite some way towards flattening the demand curve.
A better option would be to phase out any rooftop PVs and it one choses to invest in or wants solar, to invest in placement of panels at a solar farm in upstream network areas…whilst receiving benefits (like a roof top solar) for the electricity generated. This would have many advantages from a safety, maintenance, efficiency, network, supply etc perspective. All the network issues of roof top solar would disappear over time.
The demand based tariff system isn’t overly complicated (it could be very complicated if it was fully contestable and pricing was instantaneous which can occur for some businesses) but requires some thinking and planning to take advantage of the cheaper rates through the day.
I suspect the public holidays are removed from calculations as they can change from local government area to local government area, and between states. Not all states have public holidays on the same days and as the grid is mostly interconnected, demand is based on whole network use rather than local or state demand on the network. Also, the more computations, the more likely for mistakes in calculating billing and what public holidays apply…especially where some areas allow public holiday transferability (if you work in one but not in the one for which the holiday takes place).
I like the idea in principle of centralising solar/battery to where it more likely gets better quality install/management/servicing etc, though I expect anyone who uses their own solar (esp for things like charging their car) would expect to still get that at the cost they’d previously have enjoyed.
With all due respect, I can’t agree with you on those points. The demand tariff is based on one’s peak demand in kWh in any half-hour period in the month between 4pm and 9pm. That figure is then doubled to give a notional maximum kilowatt reading. By then, you’ll have lost half the consumers. That theoretical maximum is then multiplied by the demand tariff to get a surcharge dollar figure which gets applied to every day of that month. By then you’ll have lost half the people were still following it up to that point. Furthermore, from the couple of electricity accounts that I’ve seen so far, there’s no transparency in the calculation. Can the customer actually find out when that peak period occurred and how many kilowatts they used during the nominated period?
The concept of consumers contributing to the cost of a solar farm is an interesting one. Right now though, most people with solar panels try to maximise the amount of power that they self-consume, eg by running pool filters, hot-water cylinders etc when the sun is shining. I’m not sure how that would translate to a centralised solar farm.
This is a ‘Demand tariff’, which is new type of tariff only available to customers with smart meters. Essentially, customers receive lower supply and usage charges, however a ‘demand charge’ is incurred in the peak summer months. A demand charge is a daily charge that reflects a customer’s peak time usage in a 30-minute period between 4pm and 8pm. For example, if you’re charged a 20c/kWh demand tariff, and your average load is a maximum of 3kW in a single demand 30-minute period over a month, you will be charged 60c per day. This charge is in addition to usage and supply charges, known as a ‘peak demand’ charge on bills. This charge resets every month.
Some states have adopted high(er) energy charges for daily peak demand periods. An example is shown in @benhelps post. Either billing method is to encourage minimising use in peak times through rewarding with lower total bill cost/average unit electricity cost. If battery EVs take off, this could place significant pressure on the existing network infrastructure during peak times. The higher charges in peak times aims to reduce demand so that further augmentation of the network (which has been called gold plating in the past) is minimised…and reduces network costs to the consumer.
Is it fair? It depends on one’s usage profile and ability to shift or minimise peak time usage. Those which don’t/can’t change and predominantly use peak power may not think it is fair. Those who do, might think otherwise.
An easily solution/option is to use a direct credit/debit system like a bank. 1kW generated on a solar farm =1kW used at a residence (like for like). With smart meters, the generation and usage can be tied to say offpeak, shoulder and peak periods. Any generation not used is then credited to the panel owner at a FIT rate (or forfitted to prevent over investment for financial gain). Any deficit is charged at the standard meter rate. One might say how about network charges for the supply usage…this could be covered by a daily supply charge based on purchased system capacity. With efficiencies gained and removing network constraints which could be expensive to all consumers from roof top PVs, it will still likely make solar farm PVs an attractive proposition.
There are possibly other ‘radical’ solutions as well. It just needs some thought to make it work for all the parties involved.
The current roof PVs system is unfair as it favours those who own detached or semi-detached residences with good roof area (we fit into this category). Those that rent or in multi-storey complexes are disadvantaged with their inability to install PV systems to offset electricity use. A solar farm type system brings equity to all residential consumers and could allow modest investment units (say increments of $100) rather than outlaying for full system costs upfront. Investment units allows those who can’t afford PV outright to slowly accumulate generation capacity when a unit purchase can be afforded.
The structure is certainly complicated.
Without the ability to know your consumption in real time it is also going to disadvantage most customers.
There is no way a customer is able to control with certainty their demand outcome, short of turning everything but the fridge and one light off in the evenings.
A second aspect might be once a monthly peak demand has been recorded, a consumer pays no further penalty for every other evening for consumption up to that level. Nor is their any incentive to use less on any other day.
The supply authority and retailers need to deliver a practical solution to in home relative consumption monitoring. It’s needed before any steps are taken to force customers to only having a peak demand based billing option.
We likely need both household and centralised Solar PV with or without batteries for each consumer. The BEV revolution appears to be the dominate solution for personal transportation. A BEV can deliver a very capable solution to home storage and to PV consumption. All this is achieved concurrent with reducing load on the grid.
IMO the future grid is still being designed with a centralised power model because it’s the way that suits the vested privatised interests. Increasing distributed generation and decentralised supply does change how the local grid functions, and how the national network might best function. Importantly for households with sufficient Solar PV, the greater the proportion of the costs of distribution and generation, of grid connection for energy, the more attractive it is to disconnect, IE go off the grid.
The whole thing reeks of underhanded tactics that are ethically wrong. I am an age pensioner who lives on my own and am one of the early casualties of this change.
Mid June I received an email from my provider AGL stating that early July they would be replacing my meter with a digital meter. I thought they were simply upgrading the equipment. My quarterly bill was due mid July. The very day the bill was due I received another email stating there would be changes to the pricing that actually started that very day. I went to my online account and had a look at the bill projection for the next quarter. To my surprise the amount was almost double the previous quarter.
On ringing AGL for an explanation was told it was the new demand pricing. Was also told that if I just cut back my usage between peak hours I would probably save money. He also told me that all providers would be introducing demand pricing. He neglected to tell me about the highest 30 minutes of usage in each 30 day period.
As I am an age pensioner living alone I do not have a house full of gadgets and appliances so it was difficult for me to cut back. But still thought I had to try. I made sure nothing is on standby. The only other way to cut back was to not use my heater anymore, turn off things like my internet, home phone, ring doorbell security, garage door opener. I also only have one light on during peak hours and turn off my freezer for the first two and a half hours and my fridge for the second two and a half hours. I also cook my meals during the day and only reheat them in peak hours.
At my age it is very difficult and stressful doing all this not to mention being cold of a night but can’t afford to pay double what electricity was costing me.
After 14 days of this billing period the cost so far seemed ok at $25, but 2 days later had jumped to $45, and today day 17 $50. At this rate despite all my changes my next bill is still going to be way over my last bill.
Yesterday I lodged a complaint with the energy ombudsman about the underhanded way this was imposed on me and was told they were receiving numerous complaints about this.
This change is going to hurt those who can least afford it, those who are renting, on low incomes and can’t have solar panels. I am disgusted about the way this was pushed on to me. They changed that meter knowing full well they were doing it so they could hit me with demand pricing and that once the meter was changed I couldn’t go back
Welcome to the community @Agepensioner.
It’s a disturbing situation in your example.
As each state is regulated differently are you able to update the community with your State and general part of the state?
The agreements relating to demand metering were made with the National Energy Regulator (NER) and State Govts more than two years prior. It was agreed that the wholesale/distributors would be implementing demand charging for the power supplied to each premise over a future timeline. If there is a communication issue it is also with the National Regulator, State Governments (part of the NEG) and their distributors EG Energex in SE Qld, on a state by state basis.
Where the change is applied, it will affect every consumer differently. I’m not defending the change. The generalised statements concerning the changes to billing and metering have been about providing fairer outcomes. There are a number of links in the discussion relating to this topic if that is of any interest.
Have you been able to approach other retailers and asked for other plans including a flat rate tariff based plan?
I live in South east Queensland near Redcliffe. It is my understanding that this is only being introduced in Queensland from the 1st of July. So I am among the first ones hit. The ombudsman suggested I approach other providers but thought I would just wait to see the result of my complaint first. I’m all for fairer outcomes and have even being paying extra for carbon neutral electricity for some time but I don’t see how this system is fairer
Have you been able to enquire on line to see if you get a similar result and offer for your address. My recent dealings with AGL for gas and Electricity for which I have a smart meter resulted in a non demand based tariff plan. In fact there were no demand based plans in their standard offer, nor when I asked specifically was I advised to take one up. They did exist at the time.
It appears that either the retailer (or meter owner) has decided that your old analogue accumulation meter is at its end of live and needed replacement. As it is after 12 months post 30 June 2020, any customer goes onto the default demand tariff rates provided by their retailer. This appears what has happened in your case.
For demand tariffs, if you have already minimised your peak hour usage, it is unlikely you will be unable to shift some of your usage outside the peak hours to maximise potential savings. If you are a very low electricity user, it is possible that using a lot of electricity for a short time a peak times may impact on the overall bill total.
The Australian Energy Regulator did recognise this in their decision by stating:
To address our concerns, we consider that it is necessary to amend the revised TSS to require that the Queensland distributors also provide a 12 month grace period to existing residential and small business customers that have their basic accumulation meter replaced due to end of life reasons after 30 June 2020.46 We also require that the Queensland distributors give retailers the opportunity to reassign their customers to a cost reflective network tariff within this grace period. This will ensure that customers with good load profiles will not have to wait the full 12 months to realise the savings under cost reflective tariffs.
This grace period expired on the 1 July 2021 and it is surprising that the meter owner waited until after this date to make the necessary meter change (noting, they would have known that you would have had a analogue accumulation meter needing replacement in the grace period).
I would contact AGL and lodge a complaint on the basis that the analogue accumulation meter was known to them and the meter owner prior to the end of the grace period, and it should have been changed within the grace period (30 June 2020 to 30 June 2021) so that AGL could have had the “the opportunity to reassign you (their customer) to a cost reflective network tariff within this grace period.”
Their failure to replace the meter during the grace period is no fault of your own and you may have potentially been disadvantaged by not being offered alternatives to the default ‘demand tariff’ regime from 1 Jul 2021.
Also explain your circumstances that you are a pensioner on a fixed government income and you have already undertaken as many energy saving measures as possible to minimise your usage during peak times…and the recent compulsory change over of the metering has disadvantaged you as it didn’t occur within the grace period.
Listen to everything AGL says very carefully. They can be masters of spin, at least in my experience. A decade+ ago I left them because they refused to honour their own personalised offer to me for a renewed plan when I tried to take it up. Earlier this year their gas rates lured me to them for a few months, but I returned to my previous supplier who had by then undercut them by $100s.
To the real point, today I received an email from AGL with enough hype to cause me to have a look. $50 resign-up fee, new lower rates, come have a look at us again, blah, blah.
Unravelling the new lower rates showed they were higher than the ones I left and were non-competitive even factoring in their sweeteners.
It should serve you well to follow @phb’s suggestion but also to listen very carefully and ask for everything in writing or a standard offer template for you to reference if it starts going sideways.
Thanks mark. I am just trying to find out all the info I can before making a hasty decision about what is the best thing to do. Having trouble trying to understand all the electricity talk about different tariffs etc. The whole system just seems so complicated now that I suspect most average people will struggle. You almost need a degree in the subject
@Agepensioner Have you visited the Federal Government’s Energy Mage Easy website? www.energymadeeasy.gov.au It’s nice and simple, and well worthwhile. All you need to do is enter your meter number (otherwise known as the NMI) which is quoted on your bill and it will come back with a list of all the available tariff offers and show which is the cheapest for you.
As you now have a new meter without any consumption history associated with it I suggest you take your previous bill and enter the NMI that’s quoted on it instead.
Unfortunately, the electricity wholesalers have muddied the water with the introduction of these demand tariffs and the comparison website is only able to provide answers for the single tariff plans such as @mark-m has listed. I believe though it’s only a matter of time before we’re all subjected to demand tariffs, probably when all the old spinning disc meters have been replaced.
There’s nothing wrong with the principle of demand tariffs. As baseload generators (coal and gas) get phased out for sound environmental reasons the power generating companies simply have to flatten out the demand curve so that there aren’t those huge demand levels when most people are arriving home from work and are cooking their dinners and switching on the air conditioning or heating. If they don’t do so, we’re going to suffer from blackouts and from instabilities in the entire electricity grid. The difficulty comes from the heavy-handed approach that some retailers are taking.
The other advantage of the new digital meters, a perfectly valid one, is that they are read remotely without the need for meter readers to trudge from house to house. It’s much more efficient.
The Qld State Govt owns Ergon Energy and it has exclusive supply rights for vast areas of Qld. They prevent other electricity supply companies from offering to supply electricity at reduced rates.
In particular, they offer pitiful “feed-in” tariffs for people that have solar cells.
This discourages people from buying solar cells and therefore helps to reduce energy use with the resulting savings and helping with the environment.
There are a number of existing Choice topics where the retail cost of electricity is discussed. The majority of retail customers in regional Qld and the Ergon distribution area have access to more than one retailer. They do offer different rates.
Having lived the dream in NQ I’m familiar with how it used to be with Ergon also the sole retailer. Also know just how great the feed in rates were in the early days of solar PV.
It may encourage others if there are details of the region or section of the Ergon distribution network your request relates to and what the current tariffs are. We used to have 3 meters on tariffs 11, 31 and 33 to get the best outcome. But over time 31 and 33 crept up closer to 11. Controlled Tariff 33 was once closer to half 11 and night rate 31 even less.
