Response to the Essential Services Commissions Issue Paper on ensuring energy contracts are clear and fair
Consumer Action Law Centre (Consumer Action) and COTA Victoria welcome the opportunity to comment on the Essential Services Commission’s (ESC) Ensuring energy contracts are clear and fair, Issues paper (Issues paper). The deregulated energy retail market in Victoria has not delivered fair outcomes for all Victorian households accessing their essential energy services. From 1 July 2019 interventions like the Victorian Default Offer (VDO) to re-regulate electricity pricing will ensure that those who never engaged with the deregulated electricity market receive a fair price. Victorian households who use gas services still have no equivalent protection.
We strongly support the interventions proposed in the recommendations from the Independent review into the electricity and gas retail markets in Victoria (the Independent Review) that are addressed in the Issues paper. If implemented effectively these interventions will complement the VDO to ensure effective protections are in place for more Victorian households. There are many reasons that Victorians do not regularly engage in the electricity market and they should not be ripped off simply because they don’t have the capacity or ability to regularly look for the best energy price. The recommended reforms should remove the need for households to be constantly vigilant for changes in their underlying pricing or discount. It will also ensure that there are rules which guarantee that contracts default to a fair price arrangement, as opposed to default pricing being at the discretion of retailers. Leaving it to the discretion of the retailers does not benefit consume