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Electricity retailers make their biggest margins in South Australia, the state at the centre of controversy over energy prices. And retail margins in many states have jumped 50 per cent.

The transition to a clean energy future is upon us, as shown by the huge uptake of solar panels and by the Turnbull government’s decision to set up a A$1 billion Clean Energy Innovation Fund. But what about those people who are at risk of being left behind?

Our survey of lower-income households shows that information about low-carbon living is often difficult to access, and that assistance is sometimes misdirected.

As a result, transitioning to low-carbon living is much harder for these households than it should be.

Listening to the people

Between December 2015 and June 2016, we held 23 focus group discussions with 164 lower-income households across eight metropolitan and regional centres in New South Wales, South Australia, Tasmania and the Northern Territory. Our aim was to try to understand the challenges these households face in transitioning to low-carbon living. This was part of a wider study, funded by the Cooperative Research Centre for Low Carbon Living, on finding ways to help poorer households reduce their carbon impact.

Almost everyone we spoke with supported the idea of low-carbon living. However, the ability to afford whiz-bang green technology – from expensive solar panels and battery systems right down to LED lightbulbs – is a big issue for these households.

Significant increases in energy costs since the late 2000s have added to this problem. In some states, bills have more than doubled in just the past six years.

While money is a key problem, it’s not the whole story, and there are ways to help. We have found a range of factors, besides affordability, that limit lower-income households’ ability to transition to low-carbon living.

Finding reliable information

Not everyone is looking for a hand-out; many just want to know how they can help themselves become more energy-efficient.

A major barrier that cropped up time and again in our survey is accessing the “right” information. Many people get good tips about assistance programs through friends and family, or via charities like the Salvation Army (one of our in-kind project partners).

But outside these avenues, information is often only available online, and many of our participants said that they either can’t afford internet access at home or, more importantly, don’t know what to search for.

What little information trickles through is often hard to understand. The Tasmanian government, for instance, offers a range of concessions on power and heating bills for older people or those who need to run medical equipment at home. But the benefits are expressed in cents per day (the current electricity concession, for instance, is 132.557¢ per day), which can make them unnecessarily hard for customers to calculate. Eligibility criteria are also often complicated.

With access to government services increasingly being moved online, the process can become a confusing rigmarole for many people, while others may miss out entirely.

Misdirected assistance

Most of the assistance programs available to lower-income households, such as Centrelink Utilities Allowances, are aimed squarely at providing financial relief.

States and territories also have their own rebate schemes to offer relief from rising energy costs. In NSW, for example, EAPA vouchers are designed to provide emergency and crisis relief.

But with lower-income households less likely to own their homes, they are often precluded from accessing programs to encourage green energy, such as solar panel rebates. This is a classic split incentive – the owner buys the panels (and gets the rebate) but the tenant gets the benefit (lower bills), making the owner less likely to invest.

This leads to the question of why rebates are not offered for using green energy, as well as for installing it.

“Green” criteria already exist in some other assistance programs. For example, the No Interest Loan Scheme, which helps lower-income households buy products such as whitegoods, now requires appliance to meet certain energy-efficiency standards.

The same principle could easily be used to help lower-income renters access electricity from cleaner energy sources.

Giving poorer households free home energy assessments is a good start, but they are focused purely on cutting energy consumption.

Removing hurdles

The compounding impacts of energy bill increases mean that many lower-income households are doing it pretty tough. Forgoing comfort in not turning on the heater or air-conditioner is one thing, but skipping meals or medication (as many of our survey respondents do) can have significant impacts on health and well-being.

Unfortunately, lower-income households have been going without life’s essentials for far too long. Setting up assistance programs is a good start, but we need to make sure that those who need help are getting it.

Here are our five suggestions for making it happen:

1. Get the info out there. It’s important that people get the right information when they need it. Putting information online is great but it cannot be the only way – consideration must be given to those without internet access or who are less computer-literate.

2. Keep it simple. Information needs to be straightforward and clear. If it’s stuffed with jargon and confusing numbers, it can become self-defeating.

3. Support the support organisations. Charities like the Salvation Army and the St Vincent de Paul Society serve important roles within our community, but they too need our continued help, especially when funding is not keeping up with needs.

4. Get value for the public’s money. A billion-dollar public fund may sound like a big deal, but this is small fry compared to Australia’s A$878 billion annual domestic consumption expenditure. Nonetheless, it is a good start in heading towards the right direction. We just need to make sure it helps those who need it most.

5. Overcome personal pride. Asking for help is never easy, and that’s why so many lower-income families go without. Making sure that incentive programs reach the right people, in the right way, can dramatically improve their willingness to use them. Hopefully, in the long run, fewer families will need to go without.

Edgar Liu receives funding from the Australian Housing and Urban Research Institute, Cooperative Research Centre for Low Carbon Living, New South Wales' Department of Family and Community Services, PAYCE Communities, SGCH Ltd, South Australia's Department for Communities and Social Inclusion, and Strata Community Australia (NSW chapter).

Bruce Judd receives funding from the Cooperative Research Centre for Low Carbon Living, the Australian Research Council, and the Australian Housing and Urban Research Institute.

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