2015 – VIC – Gas Suppliers Ratings
You are viewing the archived results for 2015 VIC gas suppliers. Follow the link for the current VIC gas suppliers ratings.
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Canstar Blue research finalised in September 2015, published in October 2015.
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Most Satisfied Customers | Lumo Energy
Lumo Energy is wholly owned by Snowy Hydro Limited – an Australian energy generation and retailing company, which in turn is jointly owned by the Commonwealth, New South Wales and Victorian Governments. This year, just like in 2012 and 2014, Lumo Energy was rated highest by Victorians for overall customer satisfaction.
Lumo reaches new heights with second gas customer satisfaction award
For most Australians, flicking the switch on various household appliances on and off is probably where their interest in and knowledge of natural gas begins and ends. It’s ‘natural’ that if something isn’t broken, you don’t need to worry about it or fix it, and unless you have a serious complaint with your energy supplier, you probably won’t feel the need to question the information – and bills – that you’re presented with. It’s called ‘setting and forgetting’ and it could be a costly mistake.
The number of retailers in our latest gas customer satisfaction ratings is testament to the competitiveness of the Victorian energy market, meaning households have plenty of choice when it comes to which retailer they want to supply their gas and electricity. You might think there isn’t much difference between them, but the feedback we’ve received from consumers suggests otherwise.
Paying for power is a grudge purchase at the best of times, so whatever you can do to make the process a little more bearable is surely worth considering. You may even save a few bucks! So if you’re considering a switch of supplier, our ratings are a great starting point on your journey. This year, just like in 2012 and 2014, Lumo Energy has been rated 5 stars in Overall Customer Satisfaction, making it the winner of Canstar Blue’s 2015 award for Gas Suppliers in Victoria.
In this report, we aim to make understanding your options as easy as possible in a language you can understand.
About the Victorian energy market
Our ratings include feedback from customers of seven different gas suppliers, but there are others operating in Victoria that didn’t feature in our final results because they didn’t secure the necessary sample size in our survey. It’s fair to assume, though, that the retailers that are included are some of the ‘biggest’ in the Victorian market – with AGL, Energy Australia and Origin Energy the biggest of them all. Prior to the introduction of Full Retail Competition in early 2002, those three companies had 100% market share in Victoria. But now, with as many as 23 different energy retailers operating in the state, their share is estimated to have been cut to around the 70% mark, according to the Essential Services Commission.
The retailers that featured in our ratings have a mix of ownership and structures – some are publicly owned and some are privately owned by Australian or overseas investors. Lumo Energy, for example, is wholly owned by Snowy Hydro Limited – an Australian energy generation and retailing company, which in turn is jointly owned by the Commonwealth, New South Wales and Victorian Governments. Snowy Hydro Limited also owns Red Energy.
While the ownership structure of Australia’s energy retailers varies, what they do have in common is that they are all licensed by the Essential Services Commission and have therefore met the essential criteria required to be so, regarding their technical and financial capabilities. The Commission ensures compliance with, and enforcement of, Victoria’s energy retail customer protection laws and codes.
Who sets gas and electricity prices in Victoria?
Households in Victoria have been able to choose their energy retailer since 2002 when legislation was passed to allow new retailers to enter what was then a small market, with the aim of increasing price competition. Full Retail Competition was introduced into New South Wales at the same time, South Australia in 2003 and Queensland in 2007. While new entrants were allowed into the market, pricing for general retail customers was still regulated.
While AGL, Energy Australia and Origin Energy previously dominated the Victorian market, new entrants such as Lumo Energy, Simply Energy, Australian Power & Gas, Neighbourhood Energy, Click Energy and Momentum Energy have increased competition – at least in terms of numbers.
In 2009, the state fully deregulated the energy market. Deregulation means that the retailers now charge whatever prices they choose, which may sound a little disconcerting, but basically means that Victorians are able to decide their energy retailers and type of contract or plan that best suits their needs. Whether or not households adequately shop around for the best gas or electricity deals is another matter. The many energy retailers operating in the state offer a range of different plans, including options like dual-fuel deals where you could potentially save money by having both your gas and electricity provided by the same retailer. Be advised, though, that prices can vary between plans and tariffs from the same supplier, so be sure to do your homework.
The cost of energy in Victoria
The cost of gas and electricity has long been an area of contention and despite the increased competition post deregulation, prices continue to rise. A St Vincent de Paul Society report recently found that over the past five years, fixed supply charges for electricity have more than doubled, while the fixed charge for gas has gone up 62%. Further research from St Vincent de Paul found that the “retail competition margin” of gas and electricity retailers has risen to $600 per customer. The rise in the retail margin means that as much as 45% of an electricity bill is paid to the retailer in Victoria and only around 11% covers the cost of actual electricity used, its report claims.
Despite the increasing cost of energy, our survey of 1,340 bill-paying Victorians found that the majority (78%) are “generally happy” with their gas supplier, but a significant number would like to switch. More than a quarter (27%) said they would like to switch suppliers but can’t find the time, while 31% agreed they would like to switch but consider the process too daunting.
On average, the Victorian households were billed $284 for gas over the last quarter before they took part in our survey – that’s more than respondents from any other state involved. The average bills reported across the states were as follows:
- South Australia: $246
- New South Wales: $240
- Queensland: $156
Given the high average cost of their gas usage, it’s no surprise that two-thirds of Victorians (66%) told us they have made an effort to use less gas in an effort to keep bills low. While this number is generally in line with the outcomes reported from the other states, Victorians were also the most likely to report higher bills for gas than for electricity. Almost one-third (32%) of bill-payers reported this, compared with 28% in New South Wales, 27% in South Australia and 24% in Queensland.
When it comes to determining overall satisfaction with a gas supplier, we found the following drivers of satisfaction in Victoria to be as follows:
- Value for money: 31%
- Service (email or telephone service): 27%
- Billing (clarity and accuracy): 21%
- Focus on environmental sustainability: 14%
- Availability of payment plan options: 7%
It’s interesting to note that a focus on environmental sustainability was a greater driver of satisfaction in Victoria than anywhere else in Australia. And despite recording the highest average bills in the country, value for money was found to be less of a concern in Victoria than in every other state – South Australia 44%, New South Wales 41%, Queensland 32%. Another noticeable difference in Victoria to other states is the importance consumers place on good customer service, which was a higher driver of satisfaction in Victoria than anywhere else. This is perhaps a result of the maturity of the Victorian market, with consumers benefiting from a greater range of retailers to choose from for longer than those in other parts of the country.
The following graph illustrates the importance of customer service in Victoria and which factors are most important in other states.
Natural gas retailers – what drives customer satisfaction in different states?
Source: Canstar Blue gas customer satisfaction survey, conducted by Colmar Brunton, September 2015, n=3,305.
Switching energy suppliers in Victoria
Switching energy suppliers can seem like a daunting thing to do, but the good news is the retailer that is going to benefit from your new business will be able to make the process as hassle free as possible – at least, that’s what they’ll tell you. It could begin with simply registering your interest in switching on a provider’s website and waiting for them to call you with details. There are also various websites dedicated to helping you compare tariffs and prices.
You can also rest assured that switching providers will not affect the reliability or quality of your energy services as distributors own and manage the infrastructure – including powerlines and pipes – that delivers gas and electricity to your home and are responsible for the supply. You do not have a choice of distributor, but can choose which retailer to buy gas and electricity from. The retailers buy gas and electricity in bulk from the distributors and then sell it onto you. Each state has its own different distributors, but in Victoria there are three gas distributors and five main electricity distributors, each of which is responsible for separate regions of the state.
- Australian Gas Networks
- Multinet Gas
- AusNet Services
- Powercor Australia
- AusNet Services
- United Energy Distribution
The Australian Energy Regulator can provide further details on which distributor is responsible for your specific area of the state.
Green energy options in Victoria
A number of retailers operating in the state offer “environmentally-friendly” plans, most of which are accredited under the GreenPower Accreditation Scheme. Lumo Energy, for example, says its Lumo Life 10 package allows customers to have 10% of their energy usage generated by renewable sources such as wind, water, solar or biomass. The service won’t change, Lumo says, it just means the company buys more green power from renewable energy sources on your behalf. Of course, it’s worth finding out how much extra plans like this might cost you.
In Victoria, households which operate small-scale, renewable green energy systems – such as solar panels – may be entitled to receive an offset on their energy costs in the form of a rebate. This is known as a solar feed-in tariff, as green power that is generated by a household, but not used, is fed back into the national power grid.
Frequently asked questions
One of the major brands to emerge after the deregulation of the energy market in Victoria, Lumo Energy is based in Melbourne and provides gas and electricity for Queensland, South Australia, New South Wales and Victoria. Originally named Victoria Energy, Lumo – which is wholly owned by Snowy Hydro Limited – secured its electricity retail license for Victoria in 2002 and started retailing in 2004. Later that year the company secured a license for the retailing of gas in Victoria and commenced retailing in 2005.
AGL is one of Australia’s oldest companies with a history stretching way back to 1837. Originally founded as the Australian Gas Light Company, it remains based in Sydney where it was charged with the job of lighting the city streets. The company was eventually re-branded as AGL Energy in 2006 and now boasts almost four million residential and commercial customers across New South Wales, Victoria, Queensland and South Australia. It is also said to be the country’s largest private owner, operator and developer of renewable energy assets.
Dodo Power & Gas
Part of the M2 Telecommunications Group, the Dodo brand was originally founded in 2001 and rapidly expanded as a small internet service provider (ISP) before reaching out to other services in the following years, including gas and electricity. It operates in Victoria, South Australia, New South Wales, the ACT and Queensland. The company offers a unique option to customers, with the convenience of bundling numerous services with the same provider – namely mobile phone plans, home broadband and utilities.
Like Lumo Energy, Red Energy is also owned by Snowy Hydro Limited and based in Victoria. It provides gas and electricity to retail customers primarily in Victoria and New South Wales, but also has a presence in South Australia. The company was founded in 2004, supplying renewable hydro-electricity sourced from the Snowy Mountains Hydro-electric Scheme – a hydroelectricity and irrigation complex in south east Australia.
Simply Energy is one of the fastest growing energy retailers in Australia, providing electricity and gas to households in Victoria, South Australia, New South Wales and Queensland. It is the retail arm of GDF SUEZ Australian Energy, part of GDF Suez – now known as Engie – a French multinational utility company. Simply Energy was founded by International Power Australia in 2005 after it completed a buyout of EnergyAustralia interests in Victoria and South Australia. It became part of Engie in 2012.
Formerly known as TRUenergy, EnergyAustralia is one of the country’s three biggest electricity and gas retailers. It is owned by the Hong Kong-based CLP Group and has a portfolio of energy generating sites, using thermal coal, natural gas, hydroelectric, solar and wind power. It was founded in 1995 from a combination of power generation and retail assets purchased from Singapore Power. In 2011 the company acquired the retail business and trade name of the New South Wales Government-owned EnergyAustralia and later adopted the name. Its headquarters are in Melbourne.
Origin Energy is one of Australia’s largest energy retailers, supplying electricity and gas to properties in New South Wales, Victoria, Queensland and South Australia. Based in Sydney, it was founded in 2000 as a result of a demerger from the Australian conglomerate Boral Limited, in which the energy business was removed from the construction materials business to form a new company. In 2010 Origin Energy purchased the retail divisions of both Country Energy and Integral Energy, and is well-known for its low-carbon products such as GreenPower, Green Gas
Canstar Blue commissioned Colmar Brunton to survey 6,000 Australian consumers across a range of categories to measure and track customer satisfaction. The outcomes reported are the results from customers within the survey group who have an active gas account and regularly pay the bills – in this case, 1,340 Victorians.
Brands must have received at least 30 responses to be included. Results are comparative and it should be noted that brands receiving three stars have still achieved a satisfaction measure of at least six out of 10. The ratings table is first sorted by star ratings and then alphabetically. A rated brand may receive a ‘N/A’ (Not Applicable) rating if it does not receive the minimum number of responses for that criteria.