Electricity contracts shock

HUNDREDS of Gippslanders have been hit by the unexplained cessation of what they thought were ironclad contracts with their electricity retailers.

Many hundreds of local home owners installed photovoltaic panels and inverters on their properties some years ago, when the cost of such equipment was significantly higher than current prices.

They budgeted on the Premium Feed-In Tariff of more than 60 cents a kilowatt hour to help cover the cost of the installations.

In most cases these householders had calculated the generous feed-in tariff would repay their investment over the course of 12 or 15 years.

However these home owners have now discovered their retailer has ceased paying them the Premium Feed-In Tariff, and are paying them less than the retail price of the electricity they contribute to the grid.

One local home owner who had installed a small photovoltaic system six years ago told the Gippsland Times she had been told the feed-in tariff she received had been altered because her retailer had not forwarded to her documentation to register the system with the Victorian Department of Primary Industry.

Following a lengthy and unproductive exchange of phone calls to her retailer the woman had gone to the Victorian Energy and Water Ombudsman.

Some four months have passed and still no resolution to her complaint has been reached, although the retailer had made an offer of a small financial compensation.

Many other householders were not notified by their retailer, and were thus unaware they needed to separately register their systems.

They also have discovered they have no recourse to reinstatement of the premium contracts they had signed with their retailer, as the premium feed-in tariff scheme was closed by DPI at the end of 2011.

Many others, who failed to read the fine print on their contracts, installed additional panels or upgraded their systems and were moved onto the wholesale price of eight cents a KWh, as determined by the Victorian government last year.

This ‘green’ energy is then sold by the retailers at a premium rate to other customers.

A spokesman for DPI provided the following explanation of why the electricity retailers have been able to cease paying some customers the Premium Feed-in Tariff .

“The Premium Feed-in Tariff scheme was officially closed to new participants on 29 December 2011 as per the relevant provisions under the Electricity Industry Act 2000 put in place by the previous government in 2009.

“As this closure is statutory in nature, it is not possible to allow any new customers to be subsequently included.

“Victoria has successfully avoided the ‘boom-bust’ experience of the solar industry in other states that eliminated all feed-in tariffs without warning.

“The government, through the Department of Primary Industries and relevant regulatory agencies, worked closely with electricity retailers, distributors, the solar installation industry and the Energy and Water Ombudsman of Victoria throughout the Premium Feed-in Tariff closure, to assist solar customers who had acted in good faith to be connected to the Premium Feed-in Tariff.

“If a customer considers that the actions (or inaction) of an electricity retailer or distributor contributed to missing out on the Premium Feed-in Tariff, then they may contact the Energy and Water Ombudsman of Victoria,” the DPI spokesman said.

The ombudsman has the power to investigate and facilitate resolution of consumer complaints and can be contacted on 1800 500 509.

More information is available at www.ewov.com.au

“If a customer considers that the actions (or inaction) of the solar installer contributed to missing out on the Premium Feed-In Tariff they may wish to contact Consumer Affairs Victoria on 1300 558 181 for assistance,” the DPI spokesman added.