Plico CEO Mr Robbie Campbell said Australians have enjoyed relatively low energy prices in recent years, but this is about to change for Western Australian households.
“We’ve had low wholesale energy prices (the prices retailers pay for electricity to supply their customers with), delays to price increases and energy credits, but this is unfortunately about to change as wholesale energy prices have more than doubled in the past 12 months,” Campbell said.
According to the Australian Energy Market Operator (AEMO), the wholesale electricity price increased by 141 per cent for the first quarter of 2022. Gas prices have also soared by two-thirds in the past 12 months.
Restrictions on trade caused by the global pandemic and more recently, the war in Ukraine are affecting the wholesale price of fossil fuels, particularly coal and natural gas.
“The increase in global energy prices over the past two years has been the largest since the 1973 oil crisis. We’ve certainly felt this at the petrol bowser and now we’re set to feel it when we receive our energy bills,” Campbell said.
“Closer to home, the Australian wholesale energy price has also been impacted by the falling reliability of coal-fired power plants. The bad news is that our reliance on fossil fuels is still relatively high,” he said.
The Australian Energy Regulator (AER), responsible for enforcing laws for the National Electricity Market (which does not include WA), has agreed to pass on price increases by setting new benchmark, or Default Market Offer (DMO), power prices. The AEMO has forecasted that retailers will increase their power bills by an average eight per cent, which equates to an additional $100 per bill.
In Western Australia, Synergy has confirmed it will be increasing its A1 Tariff by at least 2.5 per cent, as well as increasing fees and charges. WA gas retailers are yet to confirm how much they will be increasing their tariffs.
One reprieve from the expected energy price increase is the WA Government $400 electricity credit. The credit will be applied to all Synergy customers from 1 July 2022, taking the total household credit to $1,000 since 2020-21.
“I am sure the additional credit is a welcome relief for customers, as it will further buffer the rising cost of electricity. It’s also good news for solar owners too, who can expect to stay in credit on their bill for even longer” he said.
“The concern now, however, is that when this credit is expended, non-solar customers will start to feel the true brunt of rising energy costs,” Campbell added.
“According to the Clean Energy Council renewables currently make up one third of Australia’s total energy generation and are helping reduce emissions in the highest polluting sector. If the election result is anything to go on, Australians are more supportive than ever of a transition to cleaner energy,” he said.
“But we are finding there is still some resistance for West Australian households to make the transition to solar. Currently, WA has a solar penetration of about 30% and is set to triple over the next decade. With 4,500 applications going in per month for solar PV, only 7% of those applications are battery coupled which is a worry,” he said.
Plico partnered with local research agency Core Data to understand the current perceptions of energy and why some Western Australian’s are still resisting to go solar.
“We’d love to reduce our carbon footprint and go solar, but it’s too expensive” is the key barrier to more people adopting cleaner energy initiatives, a survey has found.
“In essence price trumps sustainability. People would explore green energy use, if it cost the same or less than what they currently pay,” he said.
This result is further compounded by the release of the annual rankings measuring the performance of 63 nations and the European Union on greenhouse gas emissions, renewable energy, energy use and climate policy from German-based advocacy group Germanwatch, with Australia ranked 55 overall.
From a sample of more than 500 people, 93.9 per cent believe sustainability is important although notably more than 7 in 10 say price is the most important consideration when it comes to energy decisions. In fact, 3 in 4 (76.4 per cent) believe the high cost of solar prevents people to switch to solar.
Campbell said these results reaffirm what we are hearing at the frontline.
“The market has been flooded with solar providers of different quality, pricing and reputation. People are unsure in moving across to solar because there is confusion on what is the best solution for their particular needs,” he said.
The survey also highlights a lack of understanding regarding the use of battery technology in our homes.
“People are familiar now with battery powered cars, but many are not aware you can now combine a battery with solar panels for your home. Only 2 in 5 Western Australians surveyed think they know the difference between solar panels only, and panels plus batteries. Solar is much more than just putting panels on your roof,” he said.
This result is further heightened with only 40 per cent knowing you can’t use the energy you generate any time unless you have a battery.
“We need to give people the confidence that they are choosing the best solution for their household needs, so we can all move away from an ageing grid and using fossil fuels. Of course, the end goal is to achieve net zero emissions by 2050, if not before,” Campbell said.
Understanding that the upfront cost is a significant barrier, Campbell says Plico is disrupting the industry in helping people affording a solar + battery system.
“We live in the sunniest capital city in Australia, we should all be able to benefit from solar and battery technology. With the Plico model, everyone can now generate, store and access their own sustainable energy. You won’t have to worry if there is a blackout, or if the State Government threaten to switch off panels because the grid can’t cope,” he said.
“Our reason for being is to help people use renewable energy, because it’s good for the planet, it’s affordable, and you can pay less for your energy. We have introduced a different membership model so households can access a solar + battery system without the big upfront cost,” he said.
Plico recently announced it has joined forces with SUSI Partners, a Swiss private fund manager specialising in sustainable energy infrastructure investments, to further accelerate its growth across Australia.
Since it was founded in 2019, Plico has focused on combining the latest technology in business and residential rooftop solar panels with their high-quality batteries and inverters, which has enabled them to build Australia’s largest community owned virtual power plant.
Find out how Plico can help you reduce your power bills and generate and control your own power, by contacting us or speaking to one of our switched on team members on 1300 175 426.