‘Disillusioned’ customers discover the catch in three hours of free power

Households could face higher bills after signing up for a new government scheme providing three hours of free electricity each day as power retailers warn of increased rates outside the free window.

The Albanese government’s Solar Sharer program, which took effect on Wednesday, is an attempt to spread the benefits of the clean energy transition by compelling retailers to offer free electricity to opt-in customers from 11am to 2pm, when rooftop solar regularly floods the grid with more supply than it needs and often causes prices to crater.

Government calculations suggest a typical two-person home could save hundreds of dollars a year by shifting power-hungry appliances, such as dishwashers and washing machines, into the free midday window.

However, because the vast majority of Australians are on electricity plans that are already cheaper than the maximum government-regulated prices, switching to Solar Sharer means moving to a different pay structure.

The rules set by the Australian Energy Regulator, which compel retailers to offer a Solar Sharer plan, also set upper limit on rates for the rest of the day, which are often higher than competitive retail plans.

In some instances, customers have been told by their retailers that moving to Solar Sharer may cause their overall bills to increase unless they can drastically change their power-usage pattern.

One electricity customer, Gareth from Sydney, said his retail provider advised him that it would be “commercially unrealistic” to switch to their Solar Sharer plan.

“I don’t have an electric car, but I can put my dishwasher on at 11 o’clock and my washing machine and whatever. But the fact that they’ve changed all the pricing … what I have at the moment is pretty competitive running daytime power anyway,” Gareth said.

“I’m a little bit disillusioned, if that’s the right word. But I’ll shop around and look at other retailers and see if they’re any different, but it just seems like the power companies are just taking this opportunity just to claw it all back.”

Another Sydney customer, Doug, said he was told his charges would rise outside the midday window.

“I thought great, I’ll put the pool pump on that time instead of 6am and I’ll make sure I do things in those three hours, so I phoned my supplier and the lady said if you go on this plan, then your other plan is cancelled and you have to pay more on the rest of the day,” he said.

“Well, I don’t know. Do you think that’s three hours of free electricity?”

The Albanese government’s Solar Sharer regulations force electricity retailers to offer plans that include a free three-hour period from 11am to 2pm in NSW, South-East Queensland and South Australia. An equivalent state scheme starts on October 1 in Victoria. It is available to all houses and apartments, with and without solar panels, as long as they have a smart meter and they opt in to the new plans.

Australia is a world leader in uptake of rooftop solar panels, with around 4.5 million installed around the country. It is also in the middle of an energy transition to replace ageing coal plants with solar and wind farms, backed by large batteries.

Independent MP Dai Le said in Parliament on Wednesday that free power was available only when most families in her electorate were at work. She asked Energy Minister Chris Bowen if he could rule out power bills going up for everyone.

“Can the government guarantee this isn’t this a give with one hand and take with the other scheme?” Le asked.

Bowen said that Solar Sharer is not for everyone, but it would deliver benefits for people who could shift their electricity consumption.

“For those people who can move power to the middle of the day … it is a very good option for them. That is why we are requiring energy companies to deliver it.”

Representatives from the nation’s largest power retailers have signalled that they support the reform’s intent, but industry leaders have previously warned that the timeframe for Solar Sharer’s introduction has been rushed.

They had called for it to be delayed until mid-2027 to avoid unintended consequences. One of the central concerns was that the scheme could drive up prices at other times of the day unless there were also simultaneous reforms to cut underlying costs, such as network tariffs for the use of power line infrastructure, which account for about one-third of a typical bill.

“Whilst Solar Sharer provides three free hours of electricity per day, prices outside that three-hour window are higher and differ depending on network providers,” an Australian Energy Council spokesperson said.

“This offer is only likely to benefit customers able to shift a significant proportion of their energy usage to the middle of the day.″

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