Aug 14, 2012

Koukoulas: the real shock on electricity bills

There is a shock in electricity bills -- that they are such a small part of household spending at at time when cost-of-living pressures are generally easing, writes Stephen Koukoulas of ClimateSpectator.

I suspect most people have little idea where they spend their money or how much they spend on each item they consume. The reason for this suspicion is the current debate over electricity prices and the related discussion on so-called cost of living pressures.


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11 thoughts on “Koukoulas: the real shock on electricity bills

  1. Dajopa

    Ummmmm……… prices? not worth a mention?

  2. Ian Johnston

    Aggregate data is a pretty poor way to analyse the cost of power on the households at the bottom 25% of the household expenditure curve.

  3. NeoTheFatCat

    Unfortunately, there will never be enough proof for those who desperately want to believe that they’re “doing it tough”. Either the statistics are faulty, or the ABS is in collusion with the Government.

    As always, people are unable to separate personal experience from the reality. Personal experience tells me that I never have enough for what I want, and damn the statistics that say otherwise.

  4. Hamis Hill

    DAJOPA, yes the collapse of capital gains, inevitable after the Howard-Costello mortgage debt orgy, is totally discounted in the “what have they got to whinge about” calculations.
    There has been a total and permanent change to the financial circumstances of the last thirty years.
    Never to be taken into account, it seems.

  5. drmick

    A lot of people live in an economy where the average income is double what they earn. A lot of people also haven’t had the “average wage rises”, that you talk of; yet they have to pay the same for services as those who earn 10 times the “average wage”. Dont tell any carer working in aged care that they are on the gravy train.

  6. Tim nash

    I love how this is pointed back at the “consumer”

    Like because we have a huge price rise in a utility we where supposed to all just sit around twiddling our thumbs going “oh well our salaries are going up and you know what, I spend more on going to the movies and other things anyways so putting up electricity..that’s fine!

    Exactly who is an article like this aimed at? A multi-million dollar electricity retailer CEO.

    Then there is the whole “consumers are not doing more to reduce demand”

    Well there has been reductions in demands due to solar panels.

    So we have been doing things to reduce demand..and our bills still go up.

    Can you see why consumers are so pissed off?

  7. Dogs breakfast

    Stephen K, of course you should expect a bollocking for putting facts in front of people who aren’t interested in the facts.

    Things appear to be tough for a lot of people, but it largely isn’t because of higher prices outpacing their wages.

    But there are other issues, principally telephony, plus some fancy technology, which years ago wasn’t even considered as a ‘want’ which has now become essential.

    The fact is that a lot of people who do whinge about the cost of living will also be sending their children to private schools. Now the low cost catholic and similar aren’t a part of this, but if you can afford $10K to $25k per year for your kid to go to school, you aren’t struggling because of the effects of electricity price rises.

    If Electricity bills were sent out weekly it would change the perception entirely. If Petrol bills were sent out quarterly people might stop driving.

    Perception and reality, not always aligned.

  8. pedro

    It’s simple really, as Dogs breakfast says.

    The problem is that most people pay quarterly, so it’s a whack you remember.

    Secondly, the msm (for some strange reason – definitely not high drama) always reports the annual amount of increase.

    “Average $120 increase” they screamed this week. They could have said “30 cents per day increase”, or a small increase, which is what it is. But no, it has to be as dramatic as possible.

    Why not just make all utility bills monthly? It’s surely less than half a week’s rent. End of story.

  9. stephen.coates

    I read this article with interest and take the point that it is based upon averages. I agree the majority of Australians are not average, but either above or below, but I don’t agree with the comment that a relatively small number of people are doing it tough now, not from the people I know.
    I have tracked my household spending meticulously over ten years and the impact of electricity costs was more affected by the changing household income, kids education and mortgage costs but not price increases.
    In 2008, electricity accounted for 1.3% of the dual household income and now it accounts for 6%.
    Now with no mortgage/single income, it sits behind food/dining out and health insurance as the third highest household cost. Gas hot water and cooking is excluded.
    But then we have a second beer fridge, a pool pump running 6 hours per day, muliple TV’s, PC’s etc all mostly in operating/standby mode. The price of increasing electronic consumerism.
    Then I get dismayed that the majority of the Australian public is influenced by shock jocks, headline seeking media outlets, right wing liberals and lobby biased public officals.
    Is it because they will gain more support (ratings/votes) by saying everybody will be better off with thier glass half empty views?
    I will support whoever provides the most ethical, professional, strong leadership and strategic direction.
    By nearly every peer reviewed article I have read, the majority of Australians should be grateful for the position they are in compared to the rest of the world.

  10. drsmithy

    Beware anyone peddling average figures when it comes to incomes. Median is much more representative.

    On top of which, it’s hard to take anyone seriously when they talk about cost of living pressures without including housing costs.

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