Mr BAYLEY – My question is to the chair. We are in a competitive market and I think there are eight or nine energy retailers in the state operating now. Aurora is obviously the only government-owned one. I’m interested in your strategies around retention of customers with the cost-of-living crisis and people increasingly aware of their options, they’re going to go shopping around and look for options and you have retention agents. I’m interested in the strategies and tactics you employ to try to retain customers. Have you got protocols or a particular script or approach that you can share?
Ms NYLANDER – Absolutely. I will throw to our CEO in a moment who will also hand over to our chief customer officer because we’re talking about strategies, but I can say we are absolutely are working as hard as we can to retain our clients and to serve our customers as the Tasmanian-owned and operated retailer. That is why our dividend isn’t as high a return to the government because we are investing in the business which it hadn’t been enough in recent years. We’re absolutely investing in the business to make it from a digital investment point of view. The aurora+ app is the main focus that we want to educate and get engagement on with our Tasmanian customers.
That is our main portal. We are investing heavily in the business to make sure it is modernised and ready to be able to provide the services that we need, which again will impact our profitability and make us more effective and efficient. With that sort of principle, we are up for competition and retaining our customers. I will throw to the CEO who will speak to that.
Mr CLARK – Retention is obviously a key activity in a retail market that is competitive. We don’t like to lose customers, so if someone does leave us we will call them back and try to understand their reasoning for why they left us. For us, ultimately, it is about how we improve further our service and product offerings and understand why someone might choose to leave us. Also we talk then to the virtues of the positives of what Aurora Energy does, what we are about as a brand, being Tasmanian based, the things we do in the community such as the work we do in trying to help energy literacy. In a lot of cases, we will have success in winning the customer back.
Mr BAYLEY – Do you know what sort of percentage there is in getting the customer back? Have you got data on that?
Mr CLARK – We do have data, but it is not something we would really put on the public record. It is a healthy percentage but it is certainly not the majority come back. You will have patches where you win some and lose some. It is variable over time.
Mr BAYLEY – How do you do that? Have you got incentives to induce people back? Can you offer them lower prices than what they would have been having before, had they not left you, or are there sort of free periods that you can offer? What are the sorts of inducements you can put on the table to get them back? I guess the concept is if you’re trying to get them back it’s probably too late at that point. I guess the question is how much of those kinds of inducements can be offered before customers actually leave Aurora in the first place?
Mr CLARK – I’m happy to take that, minister.
Mr DUIGAN – Yes, please.
Mr CLARK – You will win back customers at times because they have not understood, for instance, the deal they’ve been signed up on with a competitor, so that can be one aspect that will bring them back. Do we horse-trade down with large specific discounts? No, we don’t. The very vast majority of our customers are on the standing offer tariffs in Tasmania. We will do different powerhouse [?? 2:45:16] campaigns and different things that may be part of an element, but once again, it’s –
Mr BAYLEY – Is that like free power for a period of time or something like that?
Mr CLARK – An extra three hours of power and things, but these are all elements of competition, as you’d appreciate, so we don’t generally talk publicly about it.
Mr BAYLEY – I’m interested in talking to the chair about solar. In a cost‑of-living crisis and, indeed, a climate crisis, solar is incredibly important. I’m interested in what Aurora is doing to assist with the uptake of solar. As a question to lead into that, what percentage of users are currently producing power through rooftop solar?
Mr CLARK – We have approximately 42,300 customers that are currently receiving the feed-in tariff (FiT) for solar production, so it’s a reasonable percentage of our customer base. Obviously, they get paid the FiT rate that’s determined by the Economic Regulator. That is adjusted each July. As prices adjust, it is linked to the wholesale price outcomes, so it will move around year on year. In the July just gone, we saw a 15 per cent decrease in wholesale costs. As a result, the FiT came down, linked to that, but our FiT is still a very generous 8.935 cents per kilowatt hour. It stacks up very well against where other jurisdictions have moved. Victoria is 3.3 cents, New South Wales ranges between 4.9 to 6.3 cents, south‑east Queensland varies by retailer up to 8 cents. So, you can see that our tariff, as determined by OTTER (Office of the Tasmanian Economic Regulator), is a competitive rate.
Mr BAYLEY – What percentage of your customer base is that 42,000? Also, do you know what percentage of energy is fed back into the grid from rooftop solar?
Mr CLARK – I don’t know the percentage of energy.
Mr DUIGAN – I’m happy to take a swing at that. I believe it is in the order of 3.3 per cent of Tasmania’s energy production via rooftop solar.
Mr BAYLEY – I also asked about the percentage of customer base.
Mr CLARK – It would be about 15 per cent.
Mr BAYLEY – Right. What are you doing to encourage greater uptake?
Mr CLARK – I think the way that we would answer that is through the technology update. With solar, you need the proper metering, so the advanced meter rollout. Further than that, bringing energy literacy to customers, so through our A+. It has the ability for customers to understand their usage, to understand their solar production. For us, it’s energy literacy engagement in supporting the customer in their endeavours.
Mr BAYLEY – This sort of continues the theme of digital literacy, but perhaps power literacy in relation to the options for customers to pick peak and off-peak versus flat rate application. What does Aurora do to help a customer make the best possible decision? It obviously depends on a customer’s use and timing of use as to when it would be better to be locked into peak and off peak versus a flat rate. What do you do there to help a customer make the best possible decision given it’s a pretty complicated space for many people?
Mr CLARK – I think the key thing to understand with energy literacy is the energy industry isn’t easy to understand – things like tariffs and the like and moving to advanced meters. The Power People program that we started this year is specifically related to that, of training the trainer, if you like, on this very topic, and then being able to pass that through the community. As Will alluded to, things like shopping centre pop‑ups, going into aged care homes, or aged care villages, I should say. There’s a variety of things that have been done to educate the difference between time‑of‑use and flat rate tariffs.
Obviously, our industry came out of a flat rate tariff only logic in days of old, when the meter person came four times a year. You only had a flat rate, so most people are comfortable with flat rates and that’s all they understand.
Our challenge, as you said, is we try to educate people on time‑of‑use tariffs. The time‑of‑use Tariff 93 was rated the lowest by the regulator last year in the tariff structures, so we do have a very competitive time‑of‑use tariff, but there are things that obviously happen when people engage with us in the call centre and the like.
Alistair, could you maybe elaborate a little bit further? Thanks.
Mr BURKE – Yes, absolutely. We’ve got a range of tools that are available for customers to essentially compare the different tariffs and compare their consumption and see which one is the best for their needs. On our website we’ve got a tariff comparator tool. We also obviously have those similar tools available to our customer call centre agents when customers ring up and have a tariff conversation.
The really positive thing that we have in Tasmania now, which isn’t possible yet across all of Australia, is because of our saturation of advanced metres we’ve got really accurate metering data that we can actually use to inform those discussions. I think what we’ve seen in other jurisdictions is where customers have changed tariffs at the same time as a meter exchange, for example, that may not necessarily be the right option for them. We haven’t taken that approach in Tasmania. We’ve had very much an opt‑in framework with customers, and that usually happens after 12 months of a customer being on an advanced metre, so you’ve actually got real historical data to base that off.
Obviously, it’s always very hard with energy to know based on the individual customer and their behaviours what might happen into the future, but once you’ve got some strong evidence of what a customer does at their place, you can then go through the tariff calculator and the different tools to give a much more accurate view of what’s the best option for them. We know from the research that we’ve done based on when customers use their energy that the vast majority of Tasmanian customers are better off on a time‑of‑use tariff. Again, it’s something that we obviously engage with them closely on to make sure they understand it fully.
Mr BAYLEY – Do you do that proactively after 12 months? The smart meter goes in and then 12 months later there’s a sort of proactive process with that customer to discuss their best possible power options or tariff options?
Mr BURKE – We do, but within the bounds of being able to send proactive comms to customers. Some customers have opted out of those types of interactions, but we’re able to. We absolutely trigger off emails and other forms of communication to alert customers that we think they might be on a better offer. Again, that’s something that we think adds a lot of value to customers. It’s a role that we think we can play as a Tasmanian owned and operated energy business – how can we proactively add value and help customers get on to the best arrangement for them?
Mr BAYLEY – Just to continue the questioning around the Power Hours, the annual report shows that, on average, Tasmanians save 75 cents per Power Hours event, not per cent. Going to Ms Finlay’s question around costs, I’m not sure that that question was necessarily answered. I’m interested in your analysis about savings to Tasmanians versus costs to Aurora, and whether you think this is an effective tool. What are you trying to achieve and is it effective in meeting your goals?
Mr CLARK – As far as the benefits of what we’re trying to achieve, I’ll hand to Will. As far as the cost of the application, that’s commercial-in-confidence because, as you would appreciate, it’s part of our broader marketing budget, the total scheme of Power Hours. But certainly, if the inference is, ‘Is a cost greater than what the benefit is that we have paid out?’, certainly not. The cost was nowhere near that. What we’re trying to achieve in Power Hours is a combination of loyalty, marketing, energy literacy is probably the most critical element. And on that note, Will, if you could just explain a little bit further, thanks.
Mr BARBOUR – It’s a good question because it does go well and truly beyond the dollars. To some of the points we’ve already heard, we see the best outcomes for our customers when they start to understand their consumption and they build their energy literacy. We see those results, e.g., lowest bill shock score through our aurora+ customers and generally those who are on a time of use tariff. They build their understanding and that helps them to drive down their bills. So it’s a core building block.
You mentioned the average dollar figure. Power Hours is interesting in that the saving goes up the more you use it, so it’s a new proposition. It’s not even a year old yet and what we’ve seen to date is a number of customers who are still learning to interact with it. We’ve added things like splash screens within the app to help people to understand how to get the best value out of Power Hours. Fundamentally, it’s around helping people to understand, ‘If I get on top of my consumption and I understand if I can shift that to a different time of the day, I can reduce my bills’.
Mr BAYLEY – My understanding is, through you, chair or minister, that it’s limited in terms of the time slots that customers can choose, therefore, it’s limited in the context of exactly how much they can save. What’s your intentions for next year? Have you done a review and an assessment and are going to make some refinements so you can improve the customer experience and benefit? What’s your intention in the coming years with regard to this initiative?
Mr CLARK – Safe to say it will continue as part of our program fund, but we won’t sit here and elaborate our marketing strategy. We’re in competition with other retailers, but we will continue to surprise and delight Tasmanian customers with Power Hours amongst many other things we do for the customers, so it will continue to evolve and add value to Tasmanians.
Mr BAYLEY – Do you intend to make it available to all time of use slots or still have it restricted?
Ms NYLANDER – It’s expanded already and is available over a whole week in some instances. It’s a work in progress. We’re adding more as we get feedback, so it’s not only daytime spots, it’s right across the board and even in some peak times. It’s not a cynical exercise here, this is a genuine effort to improve and develop and Will can talk a little bit more on that.
Mr BARBOUR – As I mentioned, the proposition is set to turn one in January so we’ve now seen what summer events, autumn events, winter events and spring events look like from customer uptake and behaviour. Take, for example, the Christmas event that’s coming up on 23 December for six days where there’s a mix of peak and off-peak events that run for four hours each. It is the first version of the proposition so we had to develop something that we knew would work across the user base of over 100,000 people. We are looking at ways to diversify it and update its flexibility.
I’m not really able to go into details around what’s in the development pipeline for Power Hours, but it’s fair to say that we’ve got a constant feedback loop from customers through surveys on the back of every single event and we’ve taken some wonderful feedback that’s shaping how we change that.
Mr BAYLEY – So, you’re confident it’s working for them and the intention is to keep it going.
Mr BAYLEY – I want to move to your staff. There’s a snapshot in the annual report that talks to the diversity within the staff and education attainment levels and the like. I’m interested in staff satisfaction surveys, or unfair dismissal claims that might be on the cards or ongoing at the moment. Can you talk us through where you’re at in relation to surveying your staff or its health and wellbeing, and if you have active unfair dismissal cases underway?
Mr CLARK – Sure. I’ll ask our CPO to take that one. Thanks, Nic.
Ms HUNT – Thank you. With our engagement surveys, we conduct those three times a year. We also have an additional annual cultural survey as well, which measures the underlying culture and how our people are really feeling – that our values are being demonstrated consistently.
Mr BAYLEY – They are not published publicly, are they?
Ms HUNT – The culture results aren’t, but the engagement results are. The engagement results are really about that pulse check around are we living our values and how are our people feeling in terms of being connected to those. Our most recent survey in October, we had 79 per cent as our result, with a target of 70 per cent.
Mr BAYLEY – How does that compare over recent years?
Ms HUNT – Over recent years – the 2023-24 period was 67 per cent; 2022-23 was 66 per cent, so just slightly below target. We are really pleased with how we have been progressing with our investment in our engagement and culture for our people over the last periods. Our last two results, prior to the most recent one of 79 per cent, were on the target of 70 per cent, so certainly heading in a really positive direction.
Mr BAYLEY – What about active claims full stop, whether it be unfair dismissal or bullying, harassment or other processes underway. Where are you at in that regard?
Ms HUNT – We don’t have any active industrial claims relating to unfair dismissal, bullying or harassment, and we haven’t been in the industrial arena for a number of years now in that respect.
Mr BAYLEY – I don’t want this to be a Dorothy Dixer, and I’m all into electric cars, but I’m really interested in the e-transport initiative on your website, which is clearly a partnership with a car leasing company. Could you explain that for us? Besides the logic that an electric car uses electricity and will, therefore, need to have a connection and perhaps an Aurora customer, what’s the interest? Does it cost, does it earn you a return, having this relationship with carbar? There are plenty of other good Tasmanian, including electric car wholesalers and providers like the Good Car Company and so on. So, I just invite you to unpack this a little bit because it’s an initiative I hadn’t understood fully in the past.
Mr BARBOUR – Obviously, in Tassie, EVs are still relatively small in number on the roads. I think it’s around 4000 at the moment. Aurora, given our remit and our commitment to the community, wanted to bring something to Tasmania to help Tasmanians test electric vehicles. We spoke to a number of potential partners and engaged carbar, who are an interstate provider, but on the proviso that when they came to Tasmania, we would act as a marketing partner for them, stepping into a relatively small market, and give them the surety that they would have contact with an established business on the ground.
The thing we find quite attractive about carbar is that it’s a subscription model. They don’t sell vehicles direct to Tasmanians. Tasmanians can subscribe to test an EV. That brings with it a level of quite attractive –
Mr BAYLEY – What does that mean? A subscription versus a novated lease, for example? Or something else? What’s a subscription?
Mr BARBOUR – In the same way that you would subscribe to an online streaming service such as Netflix, you can subscribe to this vehicle. It’s not as involved and it’s not a time commitment like a novated lease is. There’s a 30-day sign‑off notification, but what we’ve found, especially through the period when there were long wait times for electric vehicles, Tasmanians could get into a vehicle, use it for six months, then maybe swap it for another one, test that. It helps to alleviate some of the concerns people have around things like range anxiety, availability of charge points, because they’re not making a commitment to buy or to novate, but they can subscribe for a period and test an EV.
Mr BAYLEY – Is this costing Aurora, or do you receive a return from this relationship? How does it work commercially?
Mr BARBOUR – There is a cost to the partnership, but obviously we’re in a commercial agreement with that provider and there is a relatively small return on a per-subscription basis. We very much saw a role for a business that wants Tasmanians to choose us for their energy future, and to break down some of the barriers and make energy easy for us to help Tasmanians get into an EV. So, our primary motive wasn’t necessarily for carbar to only be about commercial return. There was an element here of bringing something new to Tasmania and also to make EVs more accessible for Tasmanians, and it has helped with that.
Mr BAYLEY – Does it come with a home charging port or something like that, linked to an Aurora account? Is there a relationship to the actual power bill for the user?
Mr BARBOUR – It’s available to Aurora Energy customers. Carbar, as the provider of the vehicle, also take care of home charger installation if the customer wishes. Many customers are happy to trickle-charge overnight. I think one of the things customers learn is that you don’t actually need that EV to be at 100 per cent all the time, especially if it’s someone who uses it mostly around Hobart, Launceston, Devonport, Burnie or urban areas. Carbar take care of all the maintenance of the vehicle and the insurances, and the customer is responsible only for charging that vehicle.
Mr BAYLEY – Just a quick follow-up. How long has it been going for and what’s the assessment? Is it working for you? Is it a good deal? Are you going to stick with it for the coming years?
Mr BARBOUR – We found carbar to be a good solid partner. It’s going well. It’s meant that a number of Tasmanians have been able to test an EV for the first time, mix and match and change the models that they’re trying out and, for some, have a stopgap EV while there were long wait times, or remain long wait times with some models. It’s our intention that we maintain a relationship with that provider.
Mr BAYLEY – I will go to gas, if I may. You are also the gas retailer and in a climate crisis we need to do all we can to get off fossil fuels and that includes gas. Can you tell us what you are doing to help clients and customers get off gas and on to electricity and how you are supporting them to make that switch? Or are you still marketing gas connections as a positive, going forward?
Mr CLARK – No, effectively we do not market for new gas connections and the gas market in Tasmania is very static. As you would appreciate, only a small amount of residential households have gas. Our current position is that we support choice, so for those customers on gas we have not looked to exit them off that fuel, but nor do we at the moment have any active programs to help them in the sort of cost transition if they chose to come off gas and onto electrification. That’s not to say we won’t have something in the future but at this current point in time we don’t have an active program.
Mr BAYLEY – Putting aside the climate issues and fossil fuel issues, there has been a fair bit of research and media reporting recently, I guess, over the last year or so, about the household impacts of gas as well, the emissions in the house and the impact on human health and wellbeing. Do you have any fears about that going forward and any kind of liability issues or is it something you should be thinking about in terms of proactively helping people get off gas, not only because of climate issues but because of those household emissions and human health impacts?
Mr CLARK – At this point in time we haven’t had brought to our attention any major health aspects of being a gas retailer.
Mr BAYLEY – You haven’t seen them discussed in the media over recent years?
Mr CLARK – We’ve seen media stories, but I think I could pull out enough stories that would be both promoting and detracting from gas, so at this point in time we supply it. It’s an active fuel and has been for many decades in Tasmania. As I said, we provide our customers with that choice.
Mr BAYLEY – Looking at your statement of expectations and actually the one of TasNetworks as well, I’m interested in the terminology. This may be pedantic, but why do you term your statements of expectations ‘members statements of expectations’ as opposed to a ‘ministerial statement of expectations’, which is the normal language and what we’ve usually called these kinds of things in the past.
The Macquarie Point Development Corporation, Homes Tasmania and others have got ministerial statements of expectations. It, to me, seems like a change and a diminution of the statement of expectations. You’re not just a member, minister; you’re the minister and you have responsibility and accountability. Why is it the members’ statement of expectations, not the ministerial statement of expectations?
Mr DUIGAN – I guess I’m a member of the shareholder group, which consists of two ministers. My understanding of why that particular word is used in that context is for that.
Mr BAYLEY – Because it’s a joint statement?
Mr DUIGAN – I’m a member of a small group, but that’s as I understand that.
Mr BAYLEY – Okay. I accept that.
