The Australian Competition and Consumer Commission (ACCC) has released new guidelines to help electricity retailers and generators comply with new laws aimed at protecting consumers and businesses from excessive electricity prices.
Chair of the ACCC, Rod Sims said electricity retailers were prohibited from keeping consumer and small business prices unnecessarily high when costs fell.
Mr Sims said generators were prohibited from inflating wholesale prices or blocking access to critical contracts, which could increase retail prices.
He said the laws would form part of the Competition and Consumer Act, and take effect on 10 June.
“These new laws commence at a time when the affordability of energy is particularly pressing for so many Australian businesses and households, as communities are impacted by the COVID-19 pandemic,” he said.
“Our guidelines help electricity companies to comply with these laws, aimed at achieving fairer prices for consumers,” he said.
“Wholesale prices have reduced significantly over the past couple of months, so retailers should be assessing their prices and ensuring that they are prepared when the new laws come into effect in June.”
Mr Sims said competition and consumer issues in electricity were key compliance and enforcement priorities for the ACCC.
“These new laws will enable us to take electricity companies to court if we have evidence that they are engaging in prohibited conduct in breach of these new provisions,” he said.
He said the new laws prohibited the following conduct:
* The retail pricing prohibition will prohibit electricity retailers from charging small customers prices that were not adjusted to reflect sustained and substantial cost reductions in their underlying costs;
* The electricity financial contract liquidity prohibition will prohibit generators from restricting access to electricity hedging contracts for an anti-competitive purpose; and
* The electricity spot market prohibitions would prohibit bidding practices by generators that were engaged in fraudulently, dishonestly or in bad faith and/or for the purpose of distorting or manipulating prices in an electricity spot market.
The Commission’s 43-page guidelines can be accessed at this PS News link.
