From June 2022, the Australian energy market experienced dramatic price increases, leading to unprecedented action from some retailers trying to actively lose customers.
We have received many enquiries relating to recent price changes and announcements by ReAmped Energy, Elysian Energy, Discover Energy, GlowPower Energy, and other retailers who have taken the dramatic and unprecedented step to actively recommend their existing customers to switch away to a new retailer in order to avoid dramatic price increases.
What's going on?
Wholesale energy prices are up…
Sanctions and shunning of Russian energy exports continues to drive up global prices for the coal and gas that our generation fleet largely relies on.
Thermal coal prices are now at an unprecedented $A500 per tonne, increasing coal-fired generation wholesale prices to over $150 per megawatt hour.
Many units in Australia’s coal generation fleet are out of action for scheduled and unscheduled maintenance and repair. This pushes more demand onto our gas generators.
Gas prices have risen from $6-12 per GJ in Q1 2022, to $50 per GJ at the end of May. Government intervened to cap prices at $40 per gigajoule. Gas generation now costs around $300 per megawatt hour.
… and the retailers are nervous
Retailers perform the crucial role to collect payments from energy consumers on behalf of all other players in the energy economy, and must manage the risks and absorb the costs of late or default payers.
This is tricky terrain to navigate when wholesale prices are escalating wildly. There is a lot of regulatory constraint on retailers that governs when and by how much they can change their prices for existing customers, but they are 100% required to meet their obligations to pay their wholesale providers for the energy those customers consume.
Some larger and better established retailers are less exposed to this risk since they own their own generation assets, and are less reliant on the spot market to procure the energy their customers consume.
In principle, retailers can adopt a variety of hedging strategies to insulate them from wholesale market risk, but in practice, especially for smaller retailers, it’s impossible to avoid. At the end of the day, if they cannot charge their customers more than their wholesales costs, they will go out of business.
This is why we’ve recently seen dramatic announcements from several of the smaller and more competitively priced retailers recommending that their own customers should immediately find a new retailer.
These retailers are actively working to shed as many customers as possible, as quickly as possible, to minimise their exposure to the wholesale price increases.
This is not a growth strategy, it’s a survival strategy.
Finding your next plan
Some Bill Hero subscribers are now in an unprecedented situation where the very competitive plans we've helped you find in the past may suddenly increase in price due to the wholesale pricing shock now rolling through the market.
Your most recent Bill Hero results might say that 'everything's sweet' or 'you're on the best plan', which is correct, since these results are based on the historical prices charged in your bill, not the forward pricing that some retailers are now actively warning their customers about. 
However, you can still use your most recent Bill Hero results to find the best available alternative plan. All the relevant price calculations for all those alternative plans are already present in your results.
Just find the best priced alternative plan in your results, and this will be the best priced option for you going forward, even if it’s displayed as ‘more expensive’ than ‘Your Bill’. If you were not already aware, your Bill Hero results are regenerated for you every time you open the link, and the most recent plans and pricing will be always be shown.
Can't find your results link?
Some of our template results emails previously did not include the link to your full ranked results. We've updated this now so that all results email templates now include a link to your personalised results in a green 'Show results' button.
If your most recent results were sent using an older template that excluded this button and link, please resubmit your most recent bill by forwarding it to Uploads@billhero.com.au, and your results will be regenerated and re-sent using the updated templates, which does include the link to your full results.
Retailer won't serve you?
Retailers have always been at liberty not to accept a new customer – their signup processes are applications, not completed sales. In the past, they'd sometimes exclude customers based on location or credit checks. Our advice for this situation has always been to move to the next-ranked plan if a retailer can't or won't make the recommended plan available for you. We're now seeing some retailers displayed increased selectivity, where they might choose not to offer a particular plan based on location or other criteria, or they may have decided to stop accepting new customers altogether. If the recommended plan for you is no longer available, we recommend you should move to the next-ranked plan in your results.
What to expect going forward
We anticipate reduced competition in the retail energy market for the month of June – nearly 30 retailers have already exited or limited their offers. There is a scheduled annual price reset that occurs from 1 July every year, and we expect things to stabilise from then, albeit at higher prices than what we've been enjoying until now.
No matter what happens in the retail energy market, and no matter how dramatic the price fluctuations might be, Bill Hero will always help you find and stay on the best priced plans.