Victorian energy retailer Momentum Energy has paid $54,000 in penalties, after the Australian Competition and Consumer Commission (ACCC) decided one of its advertising campaigns misrepresented where it gets its energy.
Momentum Energy, owned by Hydro Tasmania, a generator of hydroelectricity in Tasmania, represented in an advertising campaign that it generates and supplies renewable energy to its customers, where in fact Momentum supplies customers with electricity from the National Electricity Market (NEM).
The NEM is a pool of electricity from a range of sources including coal-fired generation, so the ACCC decided that it is not possible for any retailer who supplies from the NEM to accurately claim that their electricity comes from one particular source.
Momentum’s advertising campaign ran from September to December 2015 and included the phrases, “We generate energy out of thin air. And fresh water” and “Powered by Hydro Tasmania, all our electricity is 100 per cent renewable”.
ACCC Chairman Rod Sims said although Momentum is owned by Hydro Tasmania, the electricity it supplies comes from the National Energy Market, not from hydroelectricity generated in Tasmania.
“By its advertising campaign, Momentum gave consumers the misleading impression that Momentum offered a renewable energy product, when this was not the case,” Mr Sims said.
“These sorts of claims may mislead consumers to buy a product thinking it is a ‘greener’ option than it really is.
“Such conduct not only harms consumers but also disadvantages competitors who may, for example offer accredited GreenPower plans which provide a financial incentive for new renewable electricity generation.”
The ACCC issued Momentum with infringement notices because it had reasonable grounds to believe that Momentum had contravened the Australian Consumer Law (ACL) by engaging in conduct liable to mislead the public as to the nature, manufacturing process and/or characteristics of its electricity products, in a television, print and radio advertising campaign, as well as through social media and on its website.
Hydro Tasmania CEO Steve Davy said the business apologised for any confusion the campaign may have caused and had taken action internally to ensure it was not repeated.
Mr Davy said that under the current circumstances, and with energy supply in Tasmania the number one priority, the business had chosen to comply with the ACCC’s infringement notices.
“Hydro Tasmania and Momentum Energy are committed to compliance with Australian Consumer Law and therefore took the concerns about the campaign very seriously and co-operated fully with the ACCC,” Mr Davy said.
“Momentum believed strongly that its customers were entitled to know it is part of Australia’s largest renewable energy business. The advertising campaign in question was based around this proposition.
“On occasion people will have different opinions about what advertising conveys. We have now addressed those aspects of the campaign that may have caused confusion.”
All material relating to the original Momentum campaign has since been withdrawn or removed.