Demographics of and support for vulnerable customers in QLD - PowerPoint Presentation

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Demographics of and support for vulnerable customers in QLD

2016

Lauren Solomon

Manager of Consumer Policy & ProgramsSlide2

Statistics of customers experiencing energy hardshipSlide3

Home tenure – hardship customersData from home audits and demographic analysisTable 1—Home tenure from Victorian home

audits Table

2—Home tenure from South Australian

home audits Table 3 —Home tenure, Mosaic customer segments Staying Connected

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AGL demographics

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*Source:

Experian Mosaic applied to AGL customer data FY13/14

Home Tenure (South Australia)

Number of households

Owner – fully owned / mortgage

28

Renter – Private Housing

72

Renter – Public / Community Housing

46

Home Tenure (Victoria)

Proportion of householdsOwner – fully owned / mortgage29% (23% purchasing)Renter – Private Housing35%Renter – Public / Community Housing12%

Armchair BluesAssisted EldersSpirited SolosTykes & takeawaysSimple LivingLocal FocusMulticultural MixRentalXX XXX Social HousingXXX   XOwner-occupied XXXXXXSlide4

Demographic profile of hardship customersSegments over-represented on Staying Connected

*Source:

Experian Mosaic applied to AGL customer data FY13/14

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QLD annual consumption profiles (elec)Staying Connected vs average customer base by segment

*Source:

Experian Mosaic applied to AGL customer data FY13/14

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AGL demographics

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Average consumption by segmentHardship followed by family segments have highest annual costs

Average consumption kWh

Segment

Customer sample count

Summer

Autumn

Winter

Spring

Total annual

Family

3,300

2,048

1,929

2,004

2,209

8,190

Hardship1,4442,2562,1862,3422,1868,969Pensioner

51,777

1,1901,1431,2111,1374,681Overall Resi*211,5601,4981,4101,4701,4005,778NotesConsumption period is calendar year 2014. Customers with a full year of consumptionQuarterly Bills were pro-rated into seasons"Hardship" are those on the Staying Connected program."Pensioner" are those with Senior cards (and not on Hardship)"Family" was tagged as customers with an IQ profile response where their household includes at least one adult and one child (and who haven't been tagged as Pensioners or Hardship)* includes the three segments listed above plus all the other customers not tagged. This segment would obviously include many more families, but without an IQ response, we can’t tag them> AGL demographics> March 2016Slide7

Equity & inclusionEnsuring customers don’t get left behindNew technology coming to market to benefit consumersHome energy management technologies

Batteries and solar integrationDigital metersWhat we know about vulnerable energy customers

Customers on our hardship program consume 40% more electricity than average customer base every year;

Payment plans often set below cost of consumption, due to limited capacity;High daytime loads – suited to solar PV;Significant and increasing proportions in tenanted properties;

Low or no access to capital;Low literacy levels, CALD backgrounds, often low awareness of energy use.

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AGL demographics

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Primary measures to support vulnerable customersTargeted co-investment programs from industry and governmentAimed at reducing consumption of customers participating on hardship programs. Without a sustainable reduction in consumption for this customer group, debt will continue to accrue. AGL has a project in NSW and VIC underway which includes three elements:

Solar PV – suited to the high daytime load profile of hardship programs;Behaviour change and energy literacy – to equip and empower customers;

Access to integrated community support services for non-financial support.

2. Income support and concessions reform To ensure equitable, accessible and adequate capacity to pay for customers experiencing financial difficulty.3.

Adequate resourcing of community support services Such as financial counsellors and community workers – QLD currently has by far the lowest per customer number of financial counsellors in the country.

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Equity & inclusion – the opportunities

Ensuring transition occurs to benefit society overallPartnerships for community and public housing upgrades

Clean Energy Finance Corporation

Direct partnerships between retailers and CHPsCo-investment Government / Industry / PhilanthropyRemoving

barriers to participationTenanted properties Minimum standards to ensure efficient building stock.

Shift to focus on lifecycle costs for tenant (rent, water, energy).Mandatory disclosure at point of sale

or lease – right to know future energy costs.

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AGL demographics

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Concessions Working GroupPreliminary findings – pending final report releaseOne of 5 cross-sectoral ERAA Affordability Working Groups underway throughout 2015. Members of this working group include:

AGL (Chair)Andy Singh (Origin)

Alan Love (Simply Energy)Carly Allen (QCOSS)

Cynthia Gebert (EWOV)Dean Lombard (VCOSS)Gavin Dufty (St Vincent de Paul Society)

Neville Hoehne (Ergon Energy)Owen Pascoe (AEMC - observer)Rhiannon Cook (NCOSS - withdrew)

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AGL demographics

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Concessions Reform Report Focus areasThe report reviews and assesses the current differing approaches taken across jurisdictions with respect to energy concessions, specifically with regard to:

EligibilityAdequacyAccessibility

Focusses on two key concession types:

Primary energy concessionsEmergency / crisis support paymentsCurrent mismatch in approach lacks efficiency and effectiveness for customers and industry.

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General recommendationsReform across all jurisdictionsBase concessionsSupport for jurisdictions moving towards consistent, percentage-based primary concessions;

Annual energy budgets/costs should be considered at a whole rather than individual fuels when developing primary concessions for each state;A review should be undertaken as to the eligibility for energy concessions of asylum seekers who may be on bridging and temporary protection visas;

Crisis support payments

Payments are applied within the period for which the temporary difficulty is being experienced (i.e.: not being applied arbitrarily at the end of a financial year);Simplification of any forms relevant to support applicants completion, with complementary literacy age testing;

With customer consent, retailer enabled pre-population of form-based systems for lodgment with government agencies.

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AGL demographics

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Recommendations for QLDSupported by Working GroupBase concessions Short-term recommendationsExtension of the eligibility criteria of the

Electricity and Gas Rebate to Healthcare Card holders;Ensure eligibility for concessions are linked to a customers’ capacity to pay through appropriate means testing (i.e.: Seniors Card holders).

 Medium-term recommendations

Transition to a percentage-based concession for the Electricity and Gas Rebate applied to the total bill, which adopts the principle of adequate affordable amount of energy to vulnerable customers.Adoption of general recommendations above.

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Recommendations for QLDSupported by Working Group membersCrisis support paymentsSimplification and testing of forms, to promote ease of reading to the level of an 11 year old;

Simplification of channels for the concession to be accessed and applied;Ability for energy retailers to apply the emergency concession directly to customer accounts once eligibility proven;

Greater transparency from government around the value of crisis relief payments that can be expected for customers who might have applied. This certainty assists with budgeting in the interim whilst pending approval.

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AGL demographics

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