“Beautiful Collapse of Confidence:” Consumers Losing Confidence in Energy Markets

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Consumers have lost confidence in the energy market and their confidence that the industry is working in their best interest has plummeted due to the ongoing market crisis, rising costs and concerns about system resilience.

The decline in confidence in both the electricity and gas markets is captured in the latest Energy Consumer Sentiment Survey, published by Energy Consumers Australia, which surveyed consumer opinions in June – amid a period of unprecedented chaos.

ECA CEO Lynne Gallagher said the results of the latest survey show the response to rising electricity prices, threats of supply shortages and a market suspension, rekindling the threat of the so-called death spiral in which consumers decide to go their own way. energy supply.

“While consumers worried about affordability back in April, we’ve seen a stunning collapse in confidence since then,” Gallagher said.

“Australians are clearly unimpressed with the way our system functions and are highly skeptical about whether it will get any better in the near future.

“Consumers have reacted angrily to the recent market collapse and who can blame them?”

The poll of more than 1,000 consumers found that just 40 percent of respondents said they believed the energy market was acting in their long-term interest — down from 46 percent a year earlier.

As a result of widespread expectation that energy costs will rise in the coming years, as many as 88 per cent of Australians expressed concern about the affordability of their own energy costs, with 58 per cent saying they were “very concerned”.

An even higher 94 percent of respondents said they are concerned that energy costs will become unaffordable for others within the next three years.

At the same time, there has been a sharp decline in the proportion of Australians who said their electricity supply was good value for money, with the proportion of those with a ‘positive’ opinion falling to 61 per cent, from 70 per cent a year. years earlier.

A similar drop was seen when consumers were asked about gas prices, with 63 percent of respondents saying they believed gas costs were value for money, down from 72 percent.

Gallagher said the numbers should serve as a “warning” to energy market participants, as it highlighted the risk that consumers would try to pull out of the energy market and how their energy is managed.

“If we can’t show consumers that the system puts their interests first and is able to deliver on them, Australians will be increasingly tempted to break away from the energy system and try to go their own way,” he said. Gallagher.

“We need consumers who embrace new opportunities and responsibilities, invest in new technology, make changes in how and when they use some energy, and make their energy resources available to help themselves, their neighbors and the system itself.”

In addition to concerns about energy affordability, the ECA survey shows an overwhelming majority of Australians are concerned that the energy system is not resilient, with 90 percent saying they are concerned that the system “will not withstand extreme weather events and that there are frequent power cuts’.

“Australians at the very least have a right to trust that energy will be there for them when they need it,” said Ms Gallagher.

“We are seeing natural disasters, such as the floods in Queensland and New South Wales, as well as the more recent threats to supply that have suspended the NEM, that are undermining that trust, which is bad for the whole community.”

“We know that climate change means looking to a future where the weather is more unstable and extreme weather events are more common. We need to ensure that Australians have confidence in building resilience in our communities and a system that can withstand such conditions.”

When asked about their plans to buy an electric car, just over a third (36 percent) of respondents said they plan to buy an electric car in the future, and a third said they have no plans to go electric. The remaining third said they were unsure about future vehicle purchases.

The most common barrier to buying an electric car was cost, cited by 59 percent of respondents, while they were concerned about a lack of public charging infrastructure (41 percent) and a lack of home charging options (26 percent) were also frequently cited barriers to making the switch to electric.

“It’s not fair to ask consumers to do all the heavy lifting. We’ve been encouraged to see more action from governments lately when it comes to subsidizing the cost of EVs and investing in charging infrastructure for convenience, but we think there’s room to go much further,” Gallagher said.

“If we can not only adopt EVs in our entire community, but also encourage people to charge them during the day, when solar energy will be abundant and cheap, we will have a clean source of transport and also a better balanced and therefore more reliable, energy grid.”

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