Tickets on themselves

Changes to electricity retail rules
by Dan Cass

Under a draft rule written by the Australian Energy Market Commission energy retailers could use movie tickets and other tricks to cheat consumers. The draft rule waters down a stronger proposal by the federal government.

In December 2017, Environment and Energy Minister Josh Frydenberg submitted a rule change request to the Australian Market Energy Commission (AEMC) that seeks to prevent deceptive marketing of ‘discount’ electricity offers that are actually more expensive than other available contracts.

On 20 March 2018 the AEMC responded to the Government’s proposal with a draft rule change. This draft rule is weaker than the Minister’s proposal, because it defines a breach in much narrower terms (see Figure 1 below).

The draft rule contains loopholes that make it easy for retailers to trick consumers onto expensive and misleading electricity contracts. This could even be through non-price incentives that are entirely unrelated to the provision of electricity, such as tickets to movies or sporting events.

It may be the case that the new regulation would have no material impact on retailer practices in the National Electricity Market (NEM) and thus do nothing to improve energy affordability.

Figure 1: Key difference between AEMC and Minister versions of rule change

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