Canberra's Small Businesses to Watch Fine Print in Energy Contracts

26 Jun 2003Archived News Energetics in the News

Small businesses and households should read the fine print and watch out for certain facts in an energy contract when full retail competition enters into force on 1 July 2003.

Canberra, 26 June 2003 - Energetics, Australia's leading energy consulting firm, advises small businesses and households to read the fine print and watch out for certain facts in an energy contract when full retail competition enters into force on 1 July 2003. From then on, households and small businesses across the ACT will be eligible to choose their electricity supplier for the first time.

Those that choose not to sign a contract will continue to be supplied under a 'safety net' arrangement but will face an increase of around 8% on their bills from July 1.

There are thirteen retailers licensed in the ACT but only a few of these are expected to be actively competing in the household and small business market. At this stage it is uncertain what prices retailers are going to offer but contract prices should be at least better than the 'safety net'.

Stephen Oster, Energetics' ACT Regional Manager, urged Canberra's small businesses to watch the fine print. "Energetics' has negotiated over $4 billion worth of energy contracts for some of Australia's largest companies and we know how confusing energy contracts can be."

"When comparing offers, energy users should make sure they are comparing apples with apples. There are a few tricks to watch. Prices should include all charges including energy, network (the poles & wires), national electricity market charges, metering, mandatory renewable energy. Ask your retailer if their price includes protection against things like VoLL and Force Majeure events", warns Stephen. "Look at their contract to see if there are any exclusions and make sure it is consistent with what their brochures and salespeople tell you."

"Don't be scared by the threat of reduced reliability or quality of supply, whichever retailer you choose; they will still use the same poles and wires to get the power to you", he said.

"While price is of prime importance to most businesses, think about what else is really important to you in an energy contract" says Stephen. "Consider issues such as payment terms, billing frequency, peak & off-peak rates, price guarantee, online billing, contract lengths, potential penalties if you decide to change suppliers, etc."

The ACT & Region Chamber of Commerce & Industry agrees with this point. Sarah Graham, Director of Operations, ACT & Region Chamber of Commerce & Industry says: "Whoever energy users choose as their retailer, they should make sure to do their homework and make sure that all decisions are based on accurate information"

"Get some expert advice if you need, but watch out for energy brokers that receive a commission for signing you up, they should reveal how much they receive from the retailer for their recommendation. Their advice should be what is best for you not best for them", advises Stephen Oster.

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