Australian households have been ripped off for years thanks to ‘unacceptable’ power company conduct, a new report has revealed.
The Australian Competition and Consumer Commission released its long-awaited Retail Electricity Pricing Inquiry report on Wednesday, which estimates households could save up to $400 a year under a major shake-up of Australia’s ‘broken’ electricity market.
Households have experienced a 56 per cent rise in power prices since 2007–08, which has caused a ‘serious electricity affordability problem’ for customers.
Households could save up to $400 a year under a major shake-up of Australia’s ‘broken’ electricity market, an Australian Competition and Consumer Commission report has revealed
‘They should not be paying more for electricity because of poor past decisions or inappropriate market behaviour,’ the consumer watchdog’s report stated.
The electricity market needs to be reset, according to ACCC chairman Rod Sims.
‘There are many reasons Australia has the electricity affordability issues we are now facing,’ he said.
‘Wholesale and retail markets are too concentrated. Regulation and poorly designed policy have added significant costs to electricity bills. Retailers’ marketing of discounts are inconsistent and confusing to consumers and have left many consumers on excessively high ‘standing’ offers.’
Households (stock images) are paying too much electricity, according to consumer watchdog ACCC chairman Rod Sims
The ACCC estimates that if its 56 recommendations are adopted, they will save the average household between 20 and 25 per cent on their electricity bill, or $290-$415 a year.
‘It is clear that most households are paying far too much for electricity. In addition, some of the most vulnerable in our community are forced to struggle through freezing winters and scorching summers, with many others also having difficulty paying their bills,’ Mr Sims said.
More than two million small and medium businesses could save an average of 24 per cent on their bills under the report recommendations.
Energy minister Josh Frydenberg (pictured) has welcomed the report and will consider its 56 recommedations
The consumer watchdog called for the Australian Energy Regulator to be given more powers to allow customers to compare discounts from a default or benchmark rate set by the regulator.
‘There is good news for consumers out of these recommendations, which the ACCC has said will reset the market and drive power prices lower,’ Energy Minister Josh Frydenberg told Sky News on Wednesday.
Labor energy spokesman Mark Butler said power prices had skyrocketed under Malcolm Turnbull, arguing divisions within the coalition had led to uncertainty.
Federal Treasurer Scott Morrison commissioned the ACCC to conduct an inquiry into the national electricity market in March last year.
‘We will consider the recommendations in detail and consult with stakeholders and jurisdictions as part of developing the Commonwealth’s response before the end of 2018,’ Mr Morrison said.
Prime Minister Malcolm Turnbull said power companies have taken advantage of customers for too long.
“Australians are crying out for an energy policy that is focused on them,” he told an event in Brisbane on Wednesday.
“Lower prices, put the customer first, that’s my goal.”