Enova says ‘flawed’ market dominated by ‘gentailers’ led to green energy provider’s collapse

Enova says ‘flawed’ market dominated by ‘gentailers’ led to green energy provider’s collapse

How can skyrocketing prices drive a “green energy” retailer out of a market grappling with a mix of renewable power sources?

That is a question some of Enova’s 13,000 customers might be asking after Australia’s first community-owned energy retailer was placed into voluntary administration.

The move was announced yesterday, less than two weeks after the company was named the winner of the Finder AU Green Energy Retailer of the Year award for 2022.

The situation highlights an anomaly — even when smaller retailers do their best to buy energy from renewable sources, it all goes into the national grid.

Former chair Alison Crook, who helped to found the Byron Bay-based company in 2016, said retailers had to buy supplies from a market that was “spot priced” every five minutes.

“Solar and wind [generators] are not allowed to bid, they just say how much they can put in,” she said.

“But they’re not allowed to bid because they’re regarded as unstable sources, so they never get to set the price.

“As it happens, we’ve hit winter — the demand is higher, there’s never been quite enough wind and solar to fill the grid.

View up from the middle of a power pole in Queensland.  Stretton Recreation Reserve.
Ms Crook says “gentailers” are able to benefit even when they have to purchase power at higher prices.(ABC News: Chris Gillette)

‘Flawed’ structure?

Ms Crook said the structure of the energy market allowed some companies to thrive when prices jumped from $70-80 per megawatt hour to $300-400.

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