Melbourne, Australia --- (METERING.COM) --- September 17, 2008 - Legislation has been introduced by the Victoria, Australia state government to replace retail energy price controls with a price monitoring regime and thereby boost transparency in the pricing of electricity and gas.
The new legislation will enable Victorian consumers to get more information on energy retailers’ prices, so that they can shop around and get the best deal on their gas and electricity bills. Furthermore it will strengthen existing energy consumer protections, widely considered to be the most robust and comprehensive in Australia.
Energy and resources minister Peter Batchelor said the move followed the review earlier in the year by the Australian Energy Market Commission (AEMC), which found that Victoria’s retail market is fully competitive and protecting consumers against unjustified price rises, but that the government wanted to see more transparency in pricing.
“Retailers will be required to publish a range of their competitive market offers to improve their visibility to consumers,” said Batchelor. “This will make it easier for consumers to compare energy prices and select the best deal.
“Under existing consumer protections, which will continue, retailers are required to comply with Codes of Practice for energy retailing, marketing and other industry guidelines.
“New proposed protections include a provision for the Essential Services Commission to undertake expanded price monitoring and report publicly on energy retailers’ prices,” said Batchelor.
According to Batchelor since 2002 over 60 percent of the state’s energy customers had exercised choice in choosing their retailer and seen savings of between five to 10 percent on their energy bills.
He also said the government would retain powers to ensure consumers were receiving a fair deal. “If in the future a review shows that competition isn’t working and has stopped delivering benefits, the government can step in and re-regulate standard retail tariffs.”
The new legislation has been strongly endorsed by energy industry bodies.
The Energy Retailers Association of Australia (ERAA) labelled the legislation a “sensible move,” saying that it should encourage more households to access the benefits of retail energy market competition in Victoria.
“Given that it is competition and choice that is delivering the best outcomes for consumers in Victoria, we welcome the government’s decision to adopt a different approach to regulation that involves a reserve price setting power, price monitoring and a range of consumer information services”, commented ERAA executive director Cameron O’Reilly.
In a statement the Energy Supply Association of Australia (esaa) said that compared to most other state governments, successive Victorian governments had always understood that the greatest benefits to consumers accrued from openly competitive markets, free from unwarranted government interventions.
“The Victorian government is a leader in this field and we congratulate them,” said esaa CEO Brad Page, calling on all state and territory governments to follow the leadership of Victoria and remove regulation that prevents consumers enjoying the benefits of open and competitive retail electricity and gas markets.