Energy stress is on rise – disadvantaged most at risk

Brotherhood of St. Laurence (BSL)

Amid rising inflation and cost of living pressures, a new report reveals energy stress is widespread, with one in five Australian households experiencing some form of energy stress.

The report, Power Pain: An Investigation of energy stress in Australia, from the Brotherhood of St. Laurence (BSL), draws on data from Household, Income and Labour Dynamics in Australia [HILDA], and finds that 18–23% of households in Australia experienced at least one form of energy stress over the period 2006 to 2020.

BSL’s Damian Sullivan, Principal, Research and Policy, Climate Change and Energy and co-author of the report, said: ‘Energy stress is experienced in various ways and particularly affects households experiencing disadvantage. This may be reflected in not being able to pay a bill on time, having to forego heating or cooling to allow payment for other essentials such as medicine, or rationing energy use.’

‘The amount of income impacts energy stress. Our research establishes that those in the lowest 20% by income are more vulnerable – their rate of energy stress increased by up to 8 percentage points over the period, from a low of 40% in 2008 to 48% in 2017.​ Those on JobSeeker are particularly vulnerable.’

‘We found energy stress fell by 15 percent in 2020 when the temporary Coronavirus Supplement was introduced. This shows the critical importance of an adequate level of income.’

The report also found renters, households with people who have a chronic disease or disability, the aged and sole parents are more likely to be in energy stress than the general population.

Executive Director of BSL, Travers McLeod, noted that the report’s findings were especially timely: ‘With power bills soaring, cost of living pressures rising, and many households yet to receive winter power bills, the problem of energy stress demands attention.’

‘As we accelerate the shift from high-carbon to low-carbon energy sources there are big opportunities for households to reduce energy stress. We need to ensure households most at risk of poverty and disadvantage can seize them.’

‘Low-income households and those facing energy stress should be supported to lower their energy bills by improving home energy efficiency, where possible installing rooftop solar, and moving towards efficient electric appliances and away from gas. Collaboration between the Commonwealth and states will be essential to extend and scale state and local initiatives.’

‘It’s also critical we develop agreed definitions of energy stress, and a framework to measure our progress in reducing it,’ said Mr. McLeod.

The report calls for a review of existing policies and recommends measures to reduce energy prices by supporting renewable energy, introducing minimum energy standards for all rentals, and additional reform of retail energy markets. In addition, the report calls for a fair and adequate social safety net to support those facing energy stress.

The Brotherhood of St. Laurence (BSL) is a social justice organisation working to prevent and alleviate poverty across Australia.

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