Power plans for electricity: the impact of tariff structure changes on energy vulnerable households

Consumer behaviour Energy consumption Regulatory instruments Electricity prices Smart meters Western Australia

In this report we discuss a mixed methods research project aimed at gaining a better understanding of the experience of energy vulnerable households in response to changes to electricity tariff structures.

By vulnerable, we intend those households that are either in energy poverty or are in danger of falling into energy poverty; for practical purposes we apply Horizon Power’s definition of vulnerable which is all customers in receipt of concessions, and those reporting lower incomes or with larger families.

The research is a collaboration between Bankwest Curtin Economics Centre, WACOSS and Horizon Power and draws on a rich dataset resulting from a pilot project in regional WA that was conducted by Horizon Power over the 2016/2017 summer.

With this pilot, Horizon Power was able to test key features of a ‘Power Plans’ pricing concept based on a model similar to the mobile phone plans, familiar to many. Access to smart meters at every household in the location allowed both the study participants and control group to be monitored.

The study examined the effect on consumption behaviour and customer experiences through demand data, a post pilot survey and by gathering data on first-hand experiences through semi-structured interviews. These analyses sought to understand whether respondents believed that Power Plans had: a) changed how they consume energy; b) affected their general well-being; c) increased their feelings of control; and d) lessened their feelings of vulnerability with respect to their electricity bills.

The resulting data and associated analysis are unique in Australia given the regional location of the study and nature of tariff being tested.

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BCEC Research Report No. 16/18