The latest independent assessment of retail energy competition highlights that steps taken by retailers to simplify billing and provide better information and value are delivering positive outcomes for customers.
The Australian Energy Market Commission’s latest retail energy market review shows customer satisfaction at a four-year high with a majority finding they have clear information available to them. Complaints have fallen 4 per cent, continuing a three-year decline.
The Australian Energy Council’s Chief Executive Sarah McNamara said that retailers’ efforts to increase transparency and improve support measures and comparison of different offers are benefitting customers.
“But the review also sounds a note of caution with emerging and increasing risks and stress being placed on retailers. This is the result of the COVID-19 pandemic, as well as the challenges of absorbing a raft of regulatory changes in a short period.
“Retailer margins fell by 29 per cent between 2017/18 and 2018/19. This review points to the fact that retail margins are low – an estimated $4 out of every $100 – while retailers carry credit and cash flow risks from the supply chain.
“Consideration of the implications of this for market competition and the suggested response, both during the pandemic and beyond, are an important part of this review.
“It is concerning to see that the re-introduction of price regulation appears to be dampening customers’ appetite to seek better market deals with switching levels at a three-year low.
“We need to continue to encourage households and businesses to shop around because there remain substantial savings available to customers by shifting to market deals,” Ms McNamara said.
“We welcome recognition of the changes underway in the energy market with the continued emergence of new entrants, products and services. The report outlines a number of other recommendations in response to the changes underway and we look forward to working with stakeholders to develop these measures.”
About the Australian Energy Council
The Council represents 24 major electricity and downstream natural gas businesses operating in competitive wholesale and retail energy markets. These businesses collectively generate the overwhelming majority of electricity in Australia and sell gas and electricity to over 10 million homes and businesses.