We thank the Australian Energy Market Commission (AEMC) for its consultation on the Improving the Ability to Switch to a Better Offer Rule Change Request from the Energy and Climate Ministerial Council (ECMC).
Read our submission (PDF, 144.55KB)
Loyalty penalties are a perverse outcome across the National Electricity Market (NEM), as detailed by recent ACCC inquiries. The ACCC’s most recent report shows that only 19% of customers were on their retailer’s best offer.
There are material benefits at stake for consumers from this rule change; the ACCC’s December 2024 report only looked at 78% of all residential consumers in the National Electricity Market (NEM) and still found that more than two million have been with their retailer for two or more years.
“Customers on flat rate offers that are 2 or more years old have calculated annual prices on average 16.9% or $317 higher than those on newer offers.”
The final rule change should clearly and obviously save consumers money, with more and more on lower priced offers. If it does not, then the rules have not been appropriately changed.
Our preferred approach to address this issue is to create a new obligation on retailers to place consumers on the best offer, unless the consumer opts out of such an arrangement. Such an approach would save millions of consumers throughout the NEM hundreds of dollars every year.
