It is called ''the death spiral'' and it is terrifying power suppliers.

At the moment they are awarded price rises to cover the cost of their spending on cables and substations. If power usage slides (as it has been), they are granted further price rises to ensure they can continue to recover those costs.

Potential threat to electricity: Solar panels will decrease the demand for electricity. Credit:Justin McManus

It has not been a big problem because their customers have had nowhere else to go. Until now.

Energy specialist Lucy Carter of the Grattan Institute outlined the horror scenario for suppliers while launching a new report to be released on Monday about why we are paying too much for power.