Red Energy increases electricity Service To Property charge by 25%

When I received the letter from Red Energy regarding electricity price increases it is never a good omen. However when I looked at the Service To Property charge, I was floored. A staggering 25% increase and this is before we see the flow on from the Carbon Tax which will add hundreds of dollars a year to most people’s energy bills.

The problem is I feel we’re being conned by the government. As people install low energy lights, solar panels and other government initiatives, the cost of those initiatives will be put back onto us through our energy bills. We are in effect being taxed indirectly and we can’t see the taxes. The government schemes are not cost effective. Each low energy light which can be purchased for a dollar or two is worth $10 as part of the scheme and we all end up paying for that.

I decided to pay for my own low energy lights, reduce my electricity usage rather than putting in solar panels which would put a cost on myself and neighbours, but now, even though we use under 40% of the average household, that effort is being eroded as the government cost is being put on the Service To Property, which is a cost I can’t reduce.

The irony is those who installed solar panels will soon find their savings completely eroded by the energy credits they now have to pay for via their increased energy bills. A group of 11 neighbours got together and found their saving from installing solar panels to be only around $200 a year. Now with this increase, a significant portion of that saving will have been further eroded. They’re unlikely to ever recover the cost of installing the panels.

What can we do about it? Unfortunately I’m at a loss as to what we can do about. For the government this is about raising taxes indirectly. They know we don’t have any real choices when it comes to power and gas.

When you are reviewing electricity retailers, a very important figure to consider is their Service To Property charge. Don’t just look at the kWh rate. I’ve found some retailers with lower kWh rates to end up being more expensive because of their Service To Property charge. A good technique is to enter your usage for the last 12 months and then compare both the rate and the service to property charges across electricity and gas retailers.

Kelvin Eldridge
www.JustLocal.com.au