The Federal Government has directed the Australian Competition and Consumer Commission (ACCC) to immediately commence an inquiry into retail electricity pricing amid a spike in power costs for consumers on Australia's east coast.
The ACCC will be given the power to demand information from electricity providers to get an in-depth look into what is going on in the market and to see if further intervention is needed.
The direction will be made under s 95H(1) of the Competition and Consumer Act 2010 (Cth) (the Act), which provides the Commission the power to demand information. This will enable the ACCC to find out what is going on in the market and whether there is a case for further intervention or use of the ACCC’s broader enforcement powers.
The ACCC will distribute an Issues Paper on matters relevant to the inquiry, and will be calling for public submissions, intending to conduct public and private hearings.
The ACCC’s current involvement in the retail electricity sector and related industries largely relate to ensuring compliance with the provisions of the Act prohibiting anti-competitive practices and unfair practices (such as misleading and deceptive conduct and false and misleading representations).
The review will also look into transparency and clarity of energy company contracts with consumers, and check if there has been any anti-competitive behaviour or collusion.
The terms of reference provided to the ACCC will direct them to consider:
The Government has said retail electricity markets do not appear to be operating as effectively as they could. In a joint statement, Prime Minister Malcolm Turnbull and Treasurer Scott Morrison were quoted as saying:
Commenting on the review, ACCC Chairman Rod Sims said:
In undertaking this work, the ACCC will work with energy agencies such as the Australian Energy Regulator and the Australian Energy Markets Commission.
The ACCC is expected to produce a preliminary report by the end of September 2017, with a final report due on 30 June 2018.
The ACCC is currently undertaking a dairy industry, and in 2015 undertook the East Coast Gas Inquiry at the direction of the Government, and has recently completed a market study into cattle and beef markets, and studies into the new car retailing industry and the communications sector are underway. The ACCC has also previously taken action against energy retailers for illegal door-to-door selling practices.
TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products. Nothing on this website should be construed as legal advice and does not substitute for the advice of competent legal counsel.
FREE legislation news, delivered weekly.
Sign up now.#WeLoveLegislation Tweets
NEW information resources - great for training.