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Byron Shire
February 27, 2024

Govt considers underwriting small energy retailers after Enova’s collapse

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NSW Treasurer and Minister for Energy, Matt Kean.
Photo nsw.liberal.org.au

In the wake of the collapse of local green energy retailer, Enova, the NSW government say they are considering underwriting small energy retailers who face unfair market competition from large retailers who also generate electricity.

Last week, the board of Enova Community Energy placed Enova Community Energy and Enova Energy (the retail electricity business that provides electricity) into voluntary administration.

Ballina MP Tamara Smith by the Richmond River in Ballina. Photo David Lowe.

Local MP, Tamara Smith (Greens) asked Minister for Energy, Matt Kean, in Question Time last week what he is doing to prevent Enova and other small green energy retailers from going bust.

He replied that the Electricity Infrastructure Roadmap, which was a bipartisan effort, will help drive prices down. 

‘What we need to see is small, innovative retailers like Enova Community Energy. They are critically important’.

‘We need them so that we have got a competitive retail market in NSW.

‘The government is disappointed to hear that it has entered into voluntary administration. That is particularly challenging for Enova staff. There is a national scheme in place to make sure that, when energy retailers go into administration, their consumers are protected.

‘This scheme is known as the Retailer of Last Resort scheme, which makes sure that customers always have a retailer and receive supply.

Last Resort scheme

‘To ensure ongoing competition in the market, NSW has joined with other states and territories to ask the Australian Competition and Consumer Commission (ACC) and the Australian Energy Regulator (AER) to report back to energy ministers in July on recent market dynamics, with a particular focus on bidding behaviour.

‘We need to ensure that all participants in the market are complying with their obligations under energy and competition law.

‘The government looks forward to receiving the results of that urgent body of work’.

Minsiter Kean added that a number of smaller retailers ‘have been impacted by the credit crunch that has been occurring as a result of the huge increase in wholesale electricity prices and the introduction of the price cap’.

Competition reform

‘We need to protect those small retailers’, he told parliament. ‘Otherwise, we are going to undo a decade’s worth of competition reform in the energy sector’.

‘That is not something that anyone wants to see because that means less competition and higher prices for consumers. [Federal Labor] Minister Bowen and I are aligned on this.

‘We want to work through these issues. We are looking at various options, for example, potentially an underwrite of small retailers.

‘That is one of the ideas that I floated with Minister Bowen, and he also has a number of initiatives.

‘We will get together with all the energy Ministers around the country to make sure we protect our small energy retailers so that we can continue to have a competitive market’.


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6 COMMENTS

  1. Enova was a beacon of how it COULD be in the future. Remember when every electric bill was stamped w a little red box to inform you your bill was higher due to renewables…when it was really the government’s rush to upgrade poles and wires so they could sell off the networks? AND when we were getting $0.60 feedin tariffs paid by the government…they asked the energy retailers to consider perhaps paying more for this energy they received, (they were paying about 6 cents at the time). They couldn’t be forced to pay more.. I think they all refused.
    Then about 4 years ago, the Essential Energy decided to make all electric poles they owned that were on private land… privately owned by the landholder (aka maintained by the landholder). Imagine my surprise to get a defect notice shortly after demanding I replace a wooden arm on one of the poles providing electricity to my house. Quotes came in at over $3000!
    I don’t know the “real” story on why Enova had to go down…but considering past behaviour of the big energy retailers… I assume this was a heavy lobbying of former government by them to crush competition. Origin has just been given the lovely free gift of over 13,000 customers from Enova. IS this fair? More than legislate to assist the survival of green retailers… the government should resurrect Enova with whatever it takes. Look at the performance for community by Enova. They have won so many awards! Seen the big boys winning any for their performance?
    Oh and if you are one of those people who only chases the best money deal for your electricity (and anything else for that matter) YOU are part of the problem. PHOOEY. Get with the program and use your money to support community!

  2. I am an Enova customer. I have not been informed as to wether my custom has been diverted to another retailer. How does one find out?

  3. So they weren’t taking the solar power generated from their customers and storing it in batteries to give back to them in the evening? Because that’s what their customers told me was suppose to be happening which would make them an energy producer.

    Doesn’t matter, the solution is more government money. Make me pay for your power bill, even though I’m completely off grid and am my own energy producer/provider. Green crap is a scam.

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