Alan Fels reporting into excessive energy charges

[Rowdy1961]

Can AGL explain why AGL are described in a report by Prof Alan Fels that retail energy pricing is excessive. The report states "AGL needs to explain why consumers are paying $60.10/Megawatt-hour more than seems to be justified by cost differentials,” Fels’ report said

While AGL is charging record retail pricing to your customers justified due to increasing wholesale and operational costs. How can it be possible that

AGL Energy posts $576m half-year profit. This is the highest peofit ever made by AGL.

Alan Fels report confirms that AGL is charging excessively. This is Unaustralian and theft as australians have no alternative. This price gouging is effected men women and children, causing businesses to close as they cannot afford to pay the electricity priceses being charged. 

It is so sad to see Australia and Australians being treated this way. Why is AGL and other energy retailers so selfish and cruel. This will lead to mental health conditions and death. 

https://www.australianunions.org.au/2024/02/07/inquiry-into-price-gouging-full-report-released/

[Rowdy1961]

AGL justified its increased charges due to increased costs. How do you justify your increased charges on struggling Austalians when the outcome for AGL was its highest ever profit. The justification for these price increases to customers can't be justified if you end up with such outrageous profits. It seems more extortion then fair pricing. 

[David_AGL]

Hi @Rowdy1961 

Welcome to Neighbourhood, and thanks for reaching out.

We are acutely aware of the cost-of-living pressures people are experiencing and as we announced last year, we are committed to supporting our customers during this difficult time of cost-of-living pressures with our $70 million customer support package. To date, $35 million has been spent to deliver assistance to customers to help manage cost of living pressures.

AGL’s recent half year results for FY24 reflected more stable market conditions and improved plant availability and operational performance. The significant improvement was off a very low base this time last year, which was impacted by plant outages and extreme market volatility driven by fuel costs, geopolitical factors and supply disruptions.

For our most recent price change in July 2023, AGL’s retail pricing decision absorbed some of the higher costs and applied credits to all active hardship customer accounts to partially offset the impact of the price change.

When we approach pricing decisions later in the year, we will be taking the softening of forward wholesale prices into account, along with a range of other factors.

[APEX]

How exactly is this "$70 Million Support Package" implemented and how many cents in the dollar actually make it to the account balances of those worst affected by the cost of living crisis and if it doesn't directly come off the accounts of those affected, in what meaningful way does it help these people?

[David_AGL]

Hi @APEX - I reached out to the team for a response on this one:

The $70m Customer Support Package focuses on three key areas: energy literacy, improving agent training and direct support to customers through bill credits and debt relief, as well as access to government grants and rebates.  In the first financial year of the program, we have contacted 115,000 customers with payment support options, $9.7m debt relief for hardship customers and commenced proactive outreach to deploy solar for low-income households.

For more information, please see our media release or visit the Customer Support centre.

[APEX]

Can you please provide the exact breakdown of where the money went and in what percentages?

[David_AGL]

Hi @APEX , I suspect that's probably not a level of operational detail that team will be able to share, but to your original question "how many cents in the dollar actually make it to the account balances of those worst affected by the cost of living crisis" , the answer would be the $9.7 million in direct relief (in year one of the two-year program), which would cover these two points from the release:

• Targeted payment matching and debt relief for eligible customers experiencing hardship to assist them with graduating off the Staying Connected program and focus on their on-going consumption.
• Targeted bill credits as part of proactive customer support campaigns and for eligible customers on the Staying Connected program to further assist with cost-of-living pressures.

[APEX]

Does that include the Energy Bills Relief Fund Payments?

[APEX]

Also, does that amount also include concession payments AGL would have been bound to pay regardless?

[Rowdy1961]

All of your customers are effected by excessive unreasonable service
charges. Why are you only supporting only a limited few of you customers
when this has been inflicted on all your customers

The increases are clearly excessive as AGL reported higher then previous
profits. The price increases can only be justified due to additional costs
in electricity production. Clearly this is not the case.

Electricity increases cannot be justified if profits increased also.

Will AGL act responsibly in reducing it rates to what it should have been
set at? A fair and reasonable price?

This is what Mr Fels reported and what Australians expect from responsible
service providers