CONSUMERS will be able to cut their electricity bills by agreeing to companies remotely switching off their appliances during spikes in demand.
The proposal is part of a package of federal government reforms expected to back ”cost-reflective pricing”. This will allow consumers to avoid peaks that occur for fewer than 40 hours every year but account for about 25 per cent of retail electricity bills.
Under the proposal, households and businesses would be able to cut their bills by choosing to switch off during peak demand times when power costs soar.
The system would be compulsory only for big users, with medium-sized users allowed to opt out and small users required to opt in if they want to switch off at peak times to reduce their bills.
The power pricing package is designed to tackle the price drivers that account for 42 per cent of projected NSW electricity cost rises from 2010 to 2013 on top of the average 9 per cent impact of the carbon tax. It will be put to the premiers on December 7 and is outlined in government-backed recommendations from a special inquiry to be tabled in the Senate tomorrow.
The ”opt in” recommendation could avoid big price rises for households that do not change their usage.
The change would require a national distribution of smart meters and would be accompanied by intensive public education and special protections for low-income households.
The report will recommend accreditation for companies offering to pay businesses and possibly households if they agree that non-essential power – for things such as pool filters, deep freezers or air conditioners – can be remotely switched off during spikes in demand.
The report is similar to the package to be put first to energy ministers on November 3, to a special business advisory forum on December 6 and to the Council of Australian Governments the next day.
They recommend more funding and clout for the Australian Energy Regulator, new rules to determine reasonable price rises for network businesses and a consumer advocacy body to scrutinise costs at every stage of generation and transmission.
Read more via Switch off and get paid.