MLT Working Paper 190902 Cover.jpg

Do Victoria’s households leave less money on the table when they switch electricity retailers?

 

A Working Paper by VEPC Director, Associate Professor Bruce Mountain and Stephanie Rizio, Research Officer

Governments, regulators and customer groups in Australia have urged customers to switch retailers to get better deals. Customers have responded and switching rates are high. A common view is that over almost a decade of unregulated competition a twotier market has evolved, in which “switchers” avoid the “loyalty tax” paid by “remainers”. We analyse a little over 48,000 Victorian household electricity bills to compare outcomes for switchers and remainers.

Download the Working Paper (1mb) by clicking on the image (left).

WP Cover.jpg

The exercise of market power in Australia’s National Electricity Market following the closure of the Hazelwood Power Station

 

A Working Paper by VEPC Director, Associate Professor Bruce Mountain and Dr Steven Percy

The National Electricity Market, a wholesale market covering Australia’s southern and eastern states, commenced operation in 1998. Though the market has long been considered a successful part of Australia’s energy market reforms, econometric analysis finds that coal generation closure in 2017 delivered an unexpected price shock in wholesale markets. Further analysis finds that average prices received by
the coal-fired generators when coal generators set the clearing prices, more than doubled in the year after closure compared to the previous year. The conclusions raise concerns about supply-side market concentration, and also about the design, operation and oversight of the wholesale market. This merits serious consideration not least in the context of future coal generation closure.

Download the Working Paper (5.8mb) by clicking on the image (left).

VEPC is part of the Victoria Institute of Strategic Economic Studies within Victoria University, Melbourne