The Tasmanian Economic Regulator regulates standing offer electricity prices. There is no price regulation for gas.


  • Market concentration remains stable in Tasmania. There has been very little change in market share although a new retailer, 1st Energy, – arrived in February 2019.
  • More than 90% of Tasmanians remain on the regulated price for electricity, compared to just 6% of Victorians.
  • Tasmanians continued to increase their satisfaction with the level of service they receive from their energy retailer. Satisfaction has risen a further 6% over the past year to 65%, the second highest in the national electricity market.
  • The number of customers on hardship programs increased by 47% during 2017-18 to just over 3,250, but the level of debt they had when they entered the scheme was lower.

Looking forward

Standing offers will continue to be set by the Tasmanian regulator. Continuation of retail electricity price regulation and the size of the market (second smallest in the national electricity market) were cited by retailers as barriers to entry.

The AEMC will analyse the impacts of 1st Energy entering into the Tasmanian residential market in our future retail energy competition reviews. We will also monitor the impact of reregulation in other jurisdictions and provide information to the Tasmanian Government on any actions relevant to their own regulated price regime. 


Tasmania’s electricity market is the second smallest in the National Electricity Market (NEM), and its gas market is the smallest. The roll-out of the state’s gas network targeted large users and this, together with geographic barriers, has resulted in low gas penetration.

For the electricity market:

  • there are approximately 278,000 small customers as of December 2018
  • in March 2019, there were three electricity retailers
  • Aurora Energy supplies electricity to residential and business consumers. ERM Power only supplies business consumers
  • 1stEnergy was the first retail business to enter the residential electricity market in Tasmania when they entered in February 2019.

For electricity, Tasmania introduced full retail contestability for small business customers with consumption between 50 and 150 MWh per annum, in July 2011. For residential and the remaining small business customers, it was introduced in July 2014.

Standing offer prices continue to be regulated by the Tasmania Economic Regulator. For gas, there has been full retail contestability without price regulation since the market’s inception in 2007.

Tasmania adopted the National Energy Customer Framework (NECF) in July 2012 for the retail electricity market but not for the retail gas market.

Retail market structure

The structure of a market influences the conduct of its participants and in turn the performance of the participants and outcomes for consumers as a whole. The Commission analyses a range of factors, including market concentration, customer switching and barriers to entry, expansion and exit to assess market structure. The key findings of this analysis for Tasmania are outlined below.

Market concentration remains at a HHI score of nearly 10,000 due to Aurora Energy having almost 100 per cent of residential customers in December 2018.

Short-term changes in market share, 2015-16 to Q2 2018-19 (electricity) — Residential

Source: AER and ESC data, AEMC analysis. Description: Queensland refers to South East Queensland. The market share measures (and related HHI calculations) were taken from the fourth quarter of each financial year. The exception to this is the 2018-19 year, where the measure is taken from the second quarter of the financial year and therefore does not represent the entire year. For the best experience please view this chart on a desktop computer

Retailer views on market structure

In addition to examining observable market share data and trends, the AEMC conducts a retailer survey and interviews to obtain insights from retailers of various sizes about what they believe is affecting market structure, the state of competition in the energy market and factors that retailers consider will influence the market in the future.

For Tasmania a number of retailers as part of the survey commented that price regulation and the relatively small size of the Tasmanian market remains a deterrent from more retailers entering the residential market.

Pricing practices, products and innovation

The AEMC examines how retailers compete for customers through price and non-price offerings in relation to small consumers in both the electricity and gas markets.

To analyse pricing and product innovation, the Commission examined a range of possible bill outcomes for a representative Tasmanian customer as follows:

  • For residential non-solar offer - annual consumption 7,908 with no controlled load (includes 3,559 KWh on T31 (light and power) and 4,349 on T41 (heating and hot water)).
  • For residential solar offers – as above and with a 3kW solar PV system on a flat tariff.
  • For small business offers - annual consumption of 20,000 kWh.

Standing and market offers

The below table shows the proportion of small customers on standing offers for electricity and shows that in Tasmania eight per cent of electricity customers are on electricity market offers. Gas small customer standing and market offer numbers are not recorded by the AER for Tasmania due to the small size of the market.

Proportion of small customers on standing offers in 2018

Queensland*24%↓ 4%
South East Queensland15%↓ 5%
New South Wales14%13%↓ 2%
Australian Capital Territory51%↓ 19%49%↓ 19%
South Australia9%↓ 3%11%↓ 2%
Tasmania**92%↑ 2%
Victoria***6%↓ 1%7%↓ 2%

Source: AER retail statistics and the ESC's Victorian Energy Market Report 2017-18. Note: rounded figures may not sum to 100 per cent. Data as of December 2018, except for Victoria which is based on 2017-18. Note: *Gas statistics are Queensland-wide and electricity statistics are for the deregulated region (South East Queensland). **While Tasmania has three gas offers, the AER does not publish customer numbers. ***Victorian numbers are based on residential customers only.

The figure below shows:

  • There was a small increase in the median residential electricity standing offer.
  • 1st Energy entered the Tasmanian residential electricity market and therefore introduced a market offer for Tasmania for the first time in 2018-19.

There is no small business electricity and residental gas data in the graph below.

Median residential standing and market offer bills

Consumer behaviour

In order to determine consumer behaviour the AEMC examines consumer:

  • preferences
  • sentiment and confidence
  • trust in the energy market
  • actual and intended activity.

In an effectively competitive market the expectation would be for consumers to have increasing confidence in their ability to make decisions over time.

Residential consumers

Data on residential consumer sentiment is sourced from the ECA's biannual Energy Consumer Sentiment Survey (the ECA Survey). Survey results have been compared on a year-to-year basis due to seasonality in the biannual survey responses. The ECA survey results show that September/October results are generally more pessimistic than April.

Residential consumer sentiment has decreased in the past year. In April 2019, compared to April 2018, confidence in Tasmania that:

  • the market is working in consumers’ long-term interests was 16 per cent (down three per cent)
  • they can make good decisions was 43 per cent (down one per cent)
  • they can access easily understood information was 38 per cent (down four per cent).

Residential consumer sentiment survey – conduct results

Small business behaviour

Key changes in small business consumer behaviour in Tasmania were:

  • engagement has increased in the past year with an increase in businesses’ propensity to switch from 0 per cent in 2018 to 19 per cent in 2019.
  • the level of confidence to find the right information to select a retailer or plan increased significantly by 25 per cent to 39 per cent in 2019.3

For all the Tasmanian small business sentiment survey results, see the Colmar Brunton report.

Outcomes for consumers

In order to assess the outcomes small consumers are achieving from the market, the AEMC examines small consumer perceptions and observable data on the following:

  • consumer satisfaction as measured by consumer surveys
  • observable data on:
    • the level of consumer complaints to retailers and Ombudsmen
    • disconnections
    • customers in hardship.

In a well-functioning competitive market, customers who engage can drive better outcomes for themselves and the market overall by influencing the design of products and levels of service provided. A high proportion of customers who are generally satisfied with difference aspects of the market can signal an effectively competitive market.

Residential consumer satisfaction

In April 2019 (compared to April 2018), satisfaction in Tasmania with:

  • the level of competition was 11 per cent (up two per cent)
  • customer service from electricity retailers was 65 per cent (up six per cent)
  • the value for money of electricity retailers was 40 per cent (up five per cent)
  • customer service from gas retailers was 74 per cent (up eight per cent)
  • the value for money of gas was 70 per cent (up eight per cent).

Residential consumer sentiment survey – outcomes results

Small business satisfaction

In 2019 (compared to 2018), satisfaction in Tasmania with:

  • customer service from electricity retailers was 36 per cent (down 47 per cent)
  • the value for money of electricity was 37 per cent (up four per cent)
  • choice of energy companies and plans was 0 per cent (stable with 2018).

For all the Tasmanian small business sentiment survey results, see the Colmar Brunton report.

Complaints, hardship and disconnections

Key statistics related to complaints, hardship and disconnections for Tasmania include:

  • Complaints to retailers increased by 75 per cent from 2016-17 to 2017-18 (the AER has noted this is mainly due to the reduction in complaints reported by Origin Energy which has changed its complaints recording method to be in line with the other retailers).
  • Complaints to the Ombudsman decreased by 11 per cent in 2017-18.
  • The number of electricity customers on hardship programs between June 2017 and June 2018 increased from 2,208 to 3,251.
  • The average debt of electricity customers on entry into hardship programs decreased from $1,750 in 2016-17 to $1,605 in 2017-18.
  • Electricity disconnection rates have decreased by 13 per cent from 1,015 in 2016-17 to 818 in 2017-18.
  • There was a 49 per cent decrease in business customer electricity disconnection rates from 83 in 2016-17 to 43 in 2017-18. Tasmania had the largest increase in business consumer disconnection rates in the past year.

Summary of key statistics

The below table provides a summary of the key market statistics for Tasmania.

Tasmania: Electricity

CategoryMeasurePeriod2014 review2015 review2016 review2017 review2018 review2019 reviewsource
Market characteristicsNumber of small customers ('000)As at end of previous financial year264266270272274276AER retail statistics
Number of retail brands/ businessesAs at end of previous calendar year2/23/3AEMC analysis, AEMO data
Independent rivalrySmall customers on market offers13%12%11%9%Residential: 9% Small business: 12.2%AER retail statistics
Market concentration (HHI)*N/A9,9919,9729,9559,88310,000AEMC analysis, AEMO data
Market share of Aurora Energy*100%99.96%99.95%99.93%100.00%AEMC analysis, AEMO data and AER data

* The only other electricity retailer in Tasmania is ERM Business Energy, which serves small business customers.

Tasmania: Gas

CategoryMeasurePeriod2014 review2015 review2016 review2017 review2018 review2019 reviewsource
Market characteristicsNumber of small customers ('000s)Previous financial year10.8011.0011.8013.213.9* not reportedAEMC analysis, AEMO data, OTTER
Number of retail brands / businessesAs at end of previous calendar year2/2AEMC analysis, AEMO data
Independent rivalryMarket concentration (HHI)5200.005392.005537.005,7345,7525646.00AEMC analysis, AER data
Market share of Aurora Energy*As at end of previous financial year0.360.350.3330%a30%32.00%

* The only other gas retailer in Tasmania is Tas Gas.

About the review

The Australian Energy Market Commission (AEMC) conducts an annual review of the state of  competition in the retail energy market at the request of the Council of Australian Governments (COAG) Energy Council. The 2019 review is the sixth review. The AEMC adopts a structure-conduct-framework performance to assess the state of competition and the outcomes consumers are achieving from it.