"Only tobacco prices have risen faster than electricity prices over the past decade," Mr Gibson said. While Denmark is home to the biggest electricity bills in the world, Australians faced higher network costs than Denmark, Mr Gibson said. Network costs make up about half of Australian electricity bills. Because electricity networks of poles and wires are natural monopolies, the prices they can charge are set by regulation. NSW networks have launched a legal challenge before the tribunal over a determination by the Australian Energy Regulator which, if it stands, will result in savings of between $106 and $313 this financial year for NSW households, depending on their provider. A survey of 10,000 One Big Switch members in June and July found 47 per cent said they had stopped running their heater this winter to save costs, "even though I'm cold".

Mr Gibson said this placed elderly Australians at risk. "This raises health and safety issues, particularly for people who are unwell," Mr Gibson said. A consumer advocate and spokesman for the Fifty Up Club, Christopher Zinn, also told the tribunal that older Australians were turning off their heaters in a bid to save costs. Because they are at home more often, older Australians faced higher bills for running lighting and heating, he said. "There is a thriftiness around older Australians that allows them to save on their bills, but there needs to be a greater focus to move them away from just being thrifty to ways to be more efficient, that allows them to save on electricity without going cold." Older Australians also went to bed earlier, took fewer showers, spend more days in shopping centres and even prepared fewer baked dinners in a bid to save money, Mr Zinn said. "Again, people are taking decisions that aren't really helping them, such is the frustration." Mr Gibson said consumers were "emphatic" in their support for the AER's price decision to award them with some savings.

"They desperately want some relief from soaring power prices in NSW," he told the forum. "They feel the price-setting processes in the past have been out of touch with families setting household budgets in a country where the cost of living is already very high. "We're asking the tribunal to take into account the overwhelming view of consumers that we are desperately in need of some price relief." The chief executive officer of the Consumer Action Law Centre, Gerard Brody, told the hearing that Victorian consumers enjoyed much lower prices than NSW households because electricity networks there were far more efficient. "It's pretty clear the proportion of the overall bill that Victorians pay that is attributable to network costs is lower than the proportion paid by NSW consumers," Mr Brody said. "We should not have an outcome where NSW consumers are paying more than Victorian consumers. The goal should be the lowest cost possible to deliver the necessary services."

The centre's legal counselling services were seeing increased demand for help for people struggling with electricity bills, and even facing bankruptcy. Mr Brody said it was the tribunal's responsibility to make a decision in the "long-term interest of consumers" and this should be the 'lowest cost". "We do not believe consumers' interests are necessarily the same as economic efficiency." A monopolist engaging in price discrimination could lead to an economically efficient outcome, producing "more total economic benefit", Mr Brody said. "But it's all captured by owners, and consumers receive little or no benefit." A spokesman for the Energy Users Association of Australia, which represents business customers, Hugh Grant, told the tribunal that electricity users would pay 30 per cent more than necessary under the AER decision.

Mr Grant accused the AER decision as being "arbitrary, unprincipled and in many cases illogical" in the way it had applied benchmarks for efficiency and rates of return. Electricity networks have levelled similar accusations, but in the opposite direction. The acting chief executive officer of Essential Energy, Gary Humphreys, told Fairfax Media that it was necessary for the networks to raise more revenue than had been allowed. "We have had two years of real price reductions in the last two years. We started the reform journey two years ago to take as much cost out of our business as we can and that will flow through to consumers." "There's got to be a trade off between safety, reliability and the affordability of the network."

The assistant commissioner of the NSW rural fire service, Stuart Midgley, told the tribunal it was vital that the networks continued to fund bushfire mitigation and emergency response programs. "Vegetation management around electricity poles, wires and infrastructure is a critical bush fire mitigation measure. Any reduction in vegetation clearing around electrical assets has the potential to lead to higher ignitions." But EUAA's Mr Grant accused the networks of a "scare campaign" on bushfires and said networks could choose to cut costs elsewhere. The Honourable Justice John Mansfield, the president of the Australian Competition Tribunal, said it was the job of the tribunal to make a "materially preferable" decision, conceding this was a "very amorphous concept". Justice Mansfield said it was also necessary to consider the quality of service, not just cost.

"Lowest cost possibly means pretty mediocre services," Justice Mansfield said. Lowest cost was "an easy thing to say but it's not an easy thing to apply". This is the first time that community groups are being consulted as part of a challenge by electricity networks to the regulator's electricity price decision. "I must say that we're looking very much forward to it because it's important. We expect to have some strong views," Justice Mansfield said. The hearings will conclude on Friday.