‘Unfair’ energy bill fees banned

POWER companies will be banned from slugging customers with massive late fees as the Morrison Government cracks down on “dodgy” charges.

The Australian Energy Market Commission ( AEMC) will introduce new rules today regulating “conditional discounting” after research found nearly a quarter of residential electricity customers failed to realise their pay-on-time discounts.

It’s estimated the average annual penalty for southeast Queensland residential customers was up to $135 a year and $510 a year for businesses.

But some penalties can reach as much as 40 per cent of a bill, costing hundreds of dollars a year and putting consumers into financial hardship.

Energy Minister Angus Taylor proposed the changes in February last year and said they would protect customers from “unfair penalties” by capping conditional discounts and fees to a retailer’s “reasonable cost”.

“We are protecting consumers from dodgy retailing practices and making sure discount deals are fair and transparent,” he said.

“Our focus is lower electricity prices, making sure Australian consumers get the best possible deals on their energy and ensuring retailers put their customers first.”

The new rules will apply to both gas and electricity retail contracts entered into after July 1, preventing retailers from “excessively penalising” customers who sign up to discount offers and then fail to meet the strict payment deadlines.

AEMC acting chief executive Suzanne Falvi said consumer groups had supported the changes.

“We think this rule balances protecting consumers from excessive fees with retailers’ need to recover reasonable costs when people don’t pay on time,” she said.

Retailers had fought the changes, pointing to declining use of conditional discounts, but supported the decision to not introduce a fixed cap on conditional discounts.