Questions and Answers
Changes to electricity and gas concessions
1.
What has changed with regard to the Annual Electricity Concession?
From 1 July 2012, a threshold for gas and electricity concessions was introduced to take into account the
Commonwealth’s carbon tax compensation. This is so that households are not compensated by two levels of
government for the same expense.
The Commonwealth compensation represents a subsidy of $171.60 for electricity across the year. So for a
concession card holder’s annual electricity bill, the State Government concession will not apply to the first
$171.60.
This change does not affect the average net position of those Victorians receiving energy concessions.
The Commonwealth Government estimates that the new carbon price will increase electricity bills by 10 per
cent. In dollar terms this equates to an average of $3.30 per week or $171.60 per annum.
If the Commonwealth Government’s projections of the impost of the carbon tax are incorrect and rises in
electricity prices are greater than anticipated and compensated, the Victorian Government’s ongoing concession
arrangements will ensure State Government concessions are available to cover the extra costs above those
compensated by the Commonwealth.
2.
What has changed with regard to the Winter Energy Concession for gas?
From 1 July 2012, a threshold for gas and electricity concessions was introduced to take into account the
Commonwealth’s carbon tax compensation. This is so that households are not compensated by two levels of
government for the same expense.
The Commonwealth compensation represents a subsidy of $62.40 for gas across the six winter months of the
year. So for a concession card holder’s winter gas bill, the State Government concession will not apply to the
first $62.40.
This change does not affect the average net position of those Victorians receiving energy concessions.
The Commonwealth Government estimates that the new carbon tax will increase gas bills by 9 per cent. In
dollar terms this equates to an average of $1.50 per week or $78 per annum. Approximately 80 per cent of the
cost of gas is incurred during the six winter months when the State Government gas concession is provided.
The increase in gas bills during this six month period is therefore equal to $62.40.
Department of Human Services
If the Commonwealth Government’s projections of the impost of the carbon tax are incorrect and rises in gas
prices are greater than anticipated and compensated, the Victorian Government’s ongoing concession
arrangements will ensure State Government concessions are available to cover the extra costs above those
compensated by the Commonwealth.
3.
How is the new carbon threshold being applied to a customer’s energy bill?
From 1 July 2012 the Commonwealth Government has been providing full compensation to concession
households for the impact of the carbon tax on energy bills.
For the Annual Electricity Concession
The Annual Electricity Concession (AEC) is not applied to $171.60 of a concession household’s annual
electricity bill. This equates to a reduction in concession of 8.23 cents per day or $2.50 per month or $30 per
year. Figures used are rounded off to the nearest dollar or cent.
Electricity retailers will apply the AEC carbon threshold as a daily reduction of 8.23 cents off the 17.5 per cent
concession discount.
Example for a customer’s electricity bill of $100 for a 90-day period:
 AEC before carbon threshold is applied:
$17.50 (i.e. 17.5% of $100)
 Carbon threshold is applied:
$0.0823 x 90 days = $7.41
 Final concession amount
$17.50 - $ 7.41 = $10.09
 Total amount the customer pays:
$89.91
For the Winter Energy Concession for gas
From 1 July 2012 the Winter Energy Concession for gas (WEC) is not applied to $62.40 of a concession
household’s winter gas bill. This equates to a reduction in concession of 5.93 cents per day or $1.82 per month
or $10.92 per year. Figures used are rounded off to the nearest cent.
Gas retailers apply the WEC carbon threshold as a daily reduction of 5.93 cents off the 17.5 per cent
concession discount. The WEC applies from 1 May to 31 October each year. In 2012, the carbon threshold will
apply to a customer’s WEC bills from 1 July to 31 October until it is incorporated into the May to October period.
Example for a customer’s winter gas bill of $100 for a 60-day period:
 WEC before carbon threshold is applied:
$17.50 (i.e. 17.5% of $100)
 Carbon threshold is applied:
$0.0593 x 60 days = $3.56
 Final concession amount:
$17.50 - $3.56 = $13.94
 Total remaining for customer pays:
$86.06
4.
When did the changes start?
The changes commenced on 1 July 2012.
2
5.
Will I be better off or worse off?
This change does not affect the average net position of those Victorians receiving energy concessions, because
the Victorian Government continues to provide electricity concessions on that portion of the bill that does not
receive compensation from the Commonwealth Government.
It simply means that households are not compensated by two levels of government for the same expense.
If the Commonwealth Government’s projections of the impost of the carbon tax are incorrect and rises in gas
prices are greater than anticipated and compensated, the Victorian Government’s ongoing concession
arrangements will ensure State Government concessions are available to cover the extra costs above those
compensated by the Commonwealth.
6.
I am a concession card holder. Do I need to do anything?
Customers who already receive energy concessions do not need to do anything. Energy concessions are
delivered by energy retailers as a discount off the concession customer’s bill.
The concession will be lower on future bills so the cost of energy will appear slightly higher.
However, the Commonwealth Government which is responsible for the carbon tax will compensate low-income
households for this change by providing increases in pensions, allowances and income tax cuts through the
new Commonwealth Clean Energy Future Household Assistance Package.
7.
How will I notice these changes?
Customers who already receive energy concessions will see that the concession is lower on future bills so the
cost of energy will appear slightly higher.
Compared to bills in 2011, some customers will see their concession increase and others will see a decrease.
How a household bill changes will depend on a range of factors including general price increases passed on to
customers, usage levels and the carbon tax.
However, the Commonwealth Government which is responsible for the carbon tax will compensate low-income
households for this change by providing increases in pensions, allowances and income tax cuts through the
new Commonwealth Clean Energy Future Household Assistance Package.
8.
How will compensation payments be managed?
Applications and payments will be managed by Centrelink.
9.
Who can I contact for more information about the Commonwealth Clean Energy
Future Household Assistance Package?
Visit the Clean Energy Future website at www.cleanenergyfuture.gov.au
Visit the Department of Families, Housing, Community Services and Indigenous Affairs website at
http://www.fahcsia.gov.au/about-fahcsia/feature/household-assistance-package
10.
Are there any changes to the Non-Mains Energy Concession?
No there are no changes to Non-Mains Energy Concessions in 2012.
3
11.
Are there any changes to concessions for water and rates?
The Municipal Rates Concession and the Water and Sewerage Concession will continue to be provided to
eligible concession cardholders as a 50 per cent discount up to an annual maximum cap.
In 2012–13 the Municipal Rates Concession cap will increase to $198.00 up by 2.5 per cent from the 2011–12
value of $193.40.
In 2012–13 the Water and Sewerage Concession cap will increase to $277 up by 2.5 per cent from the 2011–12
value of $270.20.
12.
Who do I contact for information about concessions?
For information about concessions visit the Victorian Department of Human Services website at
www.dhs.vic.gov.au/concessions or contact the Concessions Information Line on 1800 658 521 (toll-free).
13.
Who do I contact if I have a complaint?
The Department of Human Services Charter provides a service commitment to make a positive difference to
Victorians most in need through the provision of housing and community services. The department welcomes
feedback on services to understand the client experience and better meet needs.
The Corporate Integrity, Information and Resolutions unit (CIIRU) at the Department of Human Services
provides support and assistance in the management and development of complaints guidelines and
process. CIIRU also manages a complaints line for department staff and members of the public to register their
complaint or query. The telephone number is: 1300 884 706 or via email
[email protected].
4