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The Costco of power supply: Energy retailer promises wholesale prices

30 August 2018

One of Australia’s smallest energy retailers has launched what it calls the country’s “most transparent” power plan, with customers given access to Costco-style wholesale rates.

Energy Locals, which currently operates in New South Wales, the ACT and south east Queensland, has revealed a new membership-based offer that’s designed to challenge the dominance of AGL, Origin and EnergyAustralia.

“Addressing the cries from Canberra for more transparency and honesty in the energy sector isn’t hard,” Energy Locals founder and CEO Adrian Merrick said. “Unless you’re a big energy company.”

“As a country, our demand for energy isn’t increasing yet prices continue to hurt customers where unjustified bill increases are negatively affecting their way of life. It seems to us that big energy companies are not being honest about why.”

The ‘Member Promise 2020’ plan from Energy Locals sees customers pay apparently cheap electricity prices, but only if they pay the $4.50 a week membership fee, which will be added to bills.

“You then pay for your electricity usage at the direct rates that Energy Locals pays,” the retailer claims.

“Unlike the big energy companies, Energy Locals has policy of total price transparency and permanent savings, with a unique promise that we won’t raise our tariffs to increase profit margins,” Mr Merrick said.

“This is totally different to the big energy companies that offer a discount off a number they invent, with the intention of reducing the discount or increasing the headline price at the earliest opportunity so they can increase their profit from each customer.”

Part of the weekly membership also goes towards an Energy Locals charity partner of the customer’s choice. Partners include Cancer Council and Surf Life Saving NSW.

Energy Locals also provides carbon offsets for all its customers’ usage.

“Customers tell us they want clean power but don’t want to pay extra for it. Now they can have it all,” Mr Merrick added. “We think everyone deserves simple, affordable energy. When big energy companies increase customer prices by 20% and in the year that follows they triple their profits, it’s time for a customers to buy clean energy direct and save.”

In addition to its Member Promise 2020 plan, Energy Locals also provides another variable rate market offer called Simple Saver, with no membership fee required.

Energy Locals is due to enter the electricity markets in Victoria and South Australia in the near future.

Other retailers with no discounts

Energy Locals is not the only electricity provider to market itself as an alternative to the big discount deals that many others promote.

Tango Energy and Momentum Energy are two other prominent retailers that promote simple and easy to understand electricity plans, with no discounts or potential pitfalls for not meeting the conditions of them.

Other retailers including AGL, Origin and GloBird Energy also provide no discount products in addition to their big discount deals. In some cases, their plans with no discounts may even work out cheaper than those promising big savings.

Power providers are currently under the microscope of the energy regulators, especially in regards to the way discounts are promoted and the standard prices from which their discounts are applied.

The government looks set to act on recommendations from the Australian Competition and Consumer Commission (ACCC) that all discounted products should be applied from the same ‘default’ pricing.

View the original article here

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