Energy Consumers Australia (ECA) welcomes the Australian Energy Market Commission’s (AEMC) Pricing Review and its ambition to modernise electricity pricing, so it delivers fair and sustainable outcomes as the energy system evolves.
As more households install solar, batteries and electric vehicles, pricing rules must adapt. This review is an important opportunity to ensure electricity pricing remains fair, efficient and fit for purpose in a changing energy system.
Our submission broadly supports the direction of the reform. But we highlight that considerable further work is needed to develop, test and refine the proposals, to ensure they deliver good consumer outcomes.
To support our submission, we asked Finncorn Consulting to develop a short report assessing the impacts of the AEMC's retail pricing proposals (Attachment 1 (PDF, 288.71KB)). We also drew on previously commissioned advice from Dragoman Consulting on how to make network cost recovery fairer and more equitable (Attachment 2 (PDF, 7.08MB)).
Retail markets need to be made simpler and fairer
We support action to remove the “loyalty tax”, where long-standing customers pay more than new customers for the same plan. Our research shows Australians overwhelmingly find this unfair – regardless of whether they are a current or switching customer.
A “same plan, same price” approach could improve fairness and rebuild trust. However, reforms must reduce market complexity, not increase it. With more than 145,000 plans in the market, simplification and transparency are critical. We continue to highlight the role a consumer duty could play in addressing issues with pricing and complexity of energy plans.
Network tariffs must be fair and fit for purpose in a distributed energy future
We agree that relying heavily on consumption charges to recover network costs is increasingly unfit for purpose. We support the need for reform but highlight that any shift from consumption-based to access charges must be done carefully, gradually, and ensure vulnerable consumers are not disadvantaged. Clear definitions of fairness, efficiency and equity are needed to ensure the impacts of the reforms can be clearly understood and debated.
Energy Made Easy should become a true ‘one-stop shop’
We support funding to improve Energy Made Easy, but recommend it becomes a trusted, independent one-stop shop for energy information and advice, not just a comparison tool.
Download our submission (PDF, 912.15KB) to read more.
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