{"id":5664,"date":"2016-05-09T10:05:17","date_gmt":"2016-05-09T00:35:17","guid":{"rendered":"http:\/\/www.solarquotes.com.au\/blog\/?p=5664"},"modified":"2016-07-09T16:34:31","modified_gmt":"2016-07-09T07:04:31","slug":"supply-charges","status":"publish","type":"post","link":"https:\/\/www.solarquotes.com.au\/blog\/supply-charges\/","title":{"rendered":"5 Reasons Why Supply Charges On Electricity Bills Must Go!"},"content":{"rendered":"
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Supply charges have no place in a 21st Century electricity network.<\/p><\/div>\n

Do you know what I hate? What I truly despise? What causes black bile to bubble up from the deepest, darkest depths of my soul? Supply charges on electricity bills.<\/p>\n

What Are Supply Charges?<\/h2>\n

On my electricity bill AGL calls them\u00a0supply charges. On yours they may be called something else, such as \u00a0\u201cservice to property charge\u201d. \u00a0Which is perhaps more appropriate, as whenever I look at my bill\u00a0I feel as though I have been thoroughly serviced.<\/p>\n

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This is what the supply charges look like on my bill.<\/p><\/div>\n

But whatever name they go by, they are the fixed, daily\u00a0charges we have to pay for our grid connection, whether we use any grid electricity or not.<\/p>\n

You can turn your power off at the mains and go on a holiday, or if you are in a contemplative mood just sit in the dark. But you will still have to pay your daily supply charge.<\/p>\n

Here in South Australia I pay 63.8 cents a day, or $233 a year. While that is a fairly typical amount, there are still a lot of people who have to pay considerably more. For example, in Queensland my parents pay $1.17 a day or $429 a year, and apparently there are some households in Australia that pay over $550<\/a> a year in supply charges. But no matter how high or even how low they are, supply charges need to go, and I will give you five reasons why.<\/p>\n

Reason #1: Supply Charges Are All About Profit Maximization<\/h2>\n

There is one reason and one reason only why we have supply charges on our electricity bills, and that is profit maximization. In other words it is to increase the\u00a0revenue and profits of the electricity companies.<\/p>\n

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Supply charges increase electricity companies’ profits<\/p><\/div>\n

The way it works is this. Adding a supply charge as a large proportion of the bill enables the cost per kilowatt-hour<\/a>\u00a0to be decreased. Because this cost is lower, people have less incentive to conserve electricity, less incentive to invest in energy efficiency measures such as insulation or energy-saving appliances, and less incentive to install rooftop solar. In fact, the increase in Queensland’s supply charge last year appears specifically aimed at discouraging the uptake of rooftop solar in that state.<\/p>\n

So supply charges maximize profits by causing people to use more electricity than they would without them, which allows your electricity company\u00a0to sell more electricity, and make more money.<\/p>\n

Reason #2: Supply Charges Kill People<\/h2>\n
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Supply charges disincentivise energy efficiency and increase pollution.<\/p><\/div>\n

Now if electricity generation was harmless and only involved the occasional handful of pixie dust and rendering down the odd leprechaun (the greenest of all fuels), then profit maximization by the grid would not be a giant, bloodstained, horrific, murderous problem. But that’s not the case because supply charges kill people.<\/p>\n

In Australia 87% of electricity is still generated from burning coal and that kills. It kills directly from the effects of particulates, carcinogens, and heavy metals released into the atmosphere, and the ground level ozone it creates.\u00a0 And it kills people indirectly through global warming.<\/p>\n

And our emissions are higher than they would be if there were no supply charges.<\/p>\n

Reason #3: Supply Charges Transfer Money From The Poor To The Rich<\/h2>\n

Let’s say you are rich. You have a big house in Queensland with multiple air conditioners, a spa, a swimming pool, and you never, ever take down your Christmas lights. If you use 50 kilowatt-hours a day and are on the most common Queensland residential tariff, then including the supply charge, that electricity is going to cost you 24.4 cents a kilowatt-hour. That’s not exactly cheap, but what do you care? You’re rich!<\/p>\n

Now let’s instead say you are a Queensland couple living in poverty. Because you are so poor you are very careful with your electricity use. You don’t use air conditioning or electric heating, you microwave to avoid using the electric oven, and you switch off your hot water system in summer. As a result of all this scrimping and saving you only use 3 kilowatt-hours a day. If you are on the same tariff as that lucky bastard in the mansion across the road with the Christmas lights, then including the supply charge, your electricity will cost you 57.8 cents a kilowatt-hour. That’s more than twice as much as the energy wasting millionaire.<\/p>\n

So low income households end up paying much more for electricity than high income households because of supply charges. If there were no supply charges the millionaire would pay slightly more and the couple in poverty would pay a lot less.<\/p>\n

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Supply charges penalise the frugal (and the poor).<\/p><\/div>\n

Reason #4: Supply Charges Make Electricity Bills Confusing<\/h2>\n

I don’t understand my electricity bill.\u00a0 I really don’t.\u00a0 And if I can’t understand it, then a large portion of the population is in big trouble.<\/p>\n

Now while I’m no mathematical genius, all my ex-wives did treat me as a kind of human calculator on account of my ability to do arithmetic in my head.\u00a0 They all agreed it was the only thing I was good for.\u00a0 Apart from in the bedroom of course.\u00a0 I can sleep like a champion.<\/p>\n

The calculation of my bill includes:<\/p>\n