ELECTRICITY users today are being told to get tough with power companies deliberately over complicating contracts which are pushing up electricity prices faster than inflation and wages.

The strategies are contained in a preliminary report on retail electricity pricing produced by the Australian Competition and Consumer Commission (ACCC).

The report’s release by the Government today sets the stage for Prime Minister Malcolm Turnbull and Energy Minister Josh Frydenberg to this week announce an energy package aimed at lowering power bills and guaranteeing power supplies.

Households are being urged by the competition guardian to haggle more aggressively with electricity suppliers to counter price increases nationally averaging 43.7 per cent over 10 years.

The ACCC accuses power retailers of unnecessarily complex and confusing contracts, in some instances to get around regulations. The message is most urgent for consumers in Queensland and South Australia where since 2007-08 residential prices have risen by 51.9 per cent to $1955, and 48 per cent to $1925 respectively. But the measures also are critical for households in NSW — where prices have risen by 45.3 per cent to $1720 — and Victoria — 33.9 per cent to$1457.

And groups of businesses could fight back by using collective bargaining with power companies for better deals to help repair commercial damage caused by price rises of 52 per cent over the last decade.

Industry groups warn small businesses have seen power bills double while the Australian Industry Group reported 2017-18 contracts pimped up three-fold.

The magnitude of the damage caused by rising costs as highlighted in a submission by the Master Grocers Australia which estimated some 2200 jobs would be lost to electricity prices.

“It’s no great secret that Australia has an electricity affordability problem. What’s clear from our report is that price increases over the past 10 years are putting Australian businesses and consumers under unacceptable pressure,” ACCC Chairman Rod Sims said in a statement today.

“Consumers have been faced with increasing pressures to their household budgets as electricity prices have skyrocketed in recent years. Residential prices have increased by 63 per cent on top of inflation since 2007-08.”

Mr Sims confirmed his earlier calculation that the main thing fuelling the price hikes was “the significant increase in network costs for all states other than South Australia.”

“The main reason customers’ electricity bills have gone up is due to higher network costs, a fact which is not widely recognised. To a lesser extent, increasing green costs and retailer costs also contributed,” Mr Sims said.

“We estimate that higher wholesale costs during 2016-17 contributed to a $167 increase in bills. The wholesale (generation) market is highly concentrated and this is likely to be contributing to higher wholesale electricity prices,” Mr Sims said.

The ACCC chief urged households to master the complex range of options with power retailers to get a better deal, a course already recommended by the Government.

A problem is the multitude of offers that cannot be compared easily, and the lack of awareness of the tools available to help consumers make informed choices or seek assistance if struggling with bills.

“Many of these issues arise from unnecessarily complex and confusing behaviour by electricity retailers, and in some cases this appears to be designed to circumvent existing regulation,” said Mr Sims.

“There is much ill-informed commentary about the drivers of Australia’s electricity affordability problem. The ACCC believes you cannot address the problem unless you have a clear idea about what caused it.”

“Armed with the clear findings on the causes of the problem, the ACCC will now focus on making recommendations that will improve electricity affordability across the National Electricity Market,” Treasurer Scott Morrison noted the maze of deals on offer as he released the preliminary report today: “The ACCC also noted that complexity in the market is making it difficult for Australians to shop around for better deals and compare electricity pricing offers.”

Mr Morrison said: “The ACCC found that the main driver of cost increases was network costs, including regulatory requirements, financing costs and revenue determination processes.

“Other key factors identified were insufficient competition in generation and electricity retail markets, recent closures of coal-fired power stations and the cost of environmental schemes.

Together, these elements have contributed to an almost 44 per cent rise in the average annual residential customer bill from $1,177 to $1,691 between 2007-08 and 2016-17.”