Calls for a “Consumer Duty” in Australia’s energy market are gaining momentum. Many see this as a way to ensure providers act in customers’ best interests as the system becomes more complex.

But across this discussion, we risk overlooking the people whose experiences most clearly justify a Consumer Duty in the first place: the tens of thousands of Australians – overwhelmingly First Nations households in regional and remote areas – who must rely on prepayment electricity meters. 

Sixty-five thousand First Nations’ households across Australia access electricity through prepayment supply arrangements that mean they can experience disconnection rates as high as an average of 59 disconnections per year, a landmark new report shows.

The affordability of prepaid electricity represents an exceptional yet under examined aspect of the nation's energy transition.

Prepaid electricity — where you pay for electricity before you use it — is in common use in jurisdictions where the proportion of First Nations Australians living remotely is greatest and First Nations poverty rates are uniquely high (above 40 %).

Here we explore a previously overlooked element of the prepaid electricity system in Australia's remote and regional Northern Territory (NT): how it disproportionately burdens high consumption households with a “poverty premium”.

Our findings reveal financial disparities arising from the application of two discrete electricity payment types operating throughout the Territory since 1998: the prepayment tariff versus the residential tariff plus fixed daily supply charge.

By appraising three decades of NT Electricity Pricing Orders (EPOs) we highlight the mechanism by which prepay households using more than a threshold rate of electricity — that has varied over time — are penalised financially.

Using known rates of household energy consumption, we demonstrate that while a subset of households are better off, prepay imposes an annual premium of AUD$57–$253 on those with higher consumption (26-48kWh daily in 2018/19) — homes that incongruously experience both an elevated risk of disconnection during temperature extremes and greater energy expenses than all other Territorians.

Our perspective complicates the trope that prepay is a fairer way to distribute energy costs in Australia's most remote jurisdiction.

Authors: Bradley Riley, Michael Klerck, Francis Markham, Thomas Longden, Vanessa Napaltjari-Davis, Simon Quilty, Jimmy Frank-Jupurrurla, The prepay “poverty premium”: Perspective on Australia's Northern Territory prepayment tariff, Energy Research & Social Science, Volume 127, 2025,
104189, ISSN 2214-6296

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This study evaluates whether residential rooftop solar can serve as a preventative solution to energy insecurity among low- to moderate-income households.

Using a national, matched sample of solar and non-solar households based on detailed and address-specific data, we find that solar leads to large, robust and salient reductions in five indicators of energy insecurity.

Moreover, the benefits of solar ‘spill over’ to improve a household’s ability to pay other energy bills.

• an individual is unable to pay their electricity bill
• they receive a disconnection notice (46% less often)
• a reduction in the likelihood they reduce their energy consumption to save money on energy costs (15% less often)
• a reduction in the likelihood they forgo expenses on household necessities to pay an energy bill, and
• a reduction in the likelihood their home is kept at an uncomfortable temperature.

The results suggest that rooftop solar may be an effective tool for policymakers who seek to reduce energy insecurity.

Authors: Yozwiak, M.; Barbose, G.; Carley, S.; Forrester, S.; Konisky, D.; Memmott, T., et al. (2025). The effect of residential solar on energy insecurity among low- to moderate-income households. Nature Energy, 10(5), 569-580. http://dx.doi.org/10.1038/s41560-025-01730-y Retrieved from https://escholarship.org/uc/item/1st561b6

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