One of the largest power retailers has discontinued new customer offers due to concerns that it will be unable to give low rates without losing money as energy prices rise.
Simply Energy will instead focus on retaining its 730,000 customers in order to prevent them from switching providers.
‘Our current focus is on helping our existing customers understand their energy costs and manage short-term rate rises, while taking steps to keep our business strong in a changing energy market,’ a spokesperson said.
Some energy providers have raised electricity bills by as much as 285% a year for a typical three-to-four person household, costing homeowners an additional $1,200.
The price increase caused ReAmped Energy to advise its 80,000 clients to switch to another vendor and save hundreds of dollars.
According to an Australian Energy Council representative, if power companies do not raise their prices, they will lose money.
‘If a retailer were to acquire customers without (pricing) hedge cover today, it is unlikely that the DMO price would enable them to recover their costs,’ he said.