The Victorian Government has introduced new regulations for energy companies which include tougher penalties and new consumer protection obligations.

The Energy Legislation Amendment (Consumer Protection) Act 2015 has strengthened consumer protections in the energy sector and the enforcement powers of the regulator, Essential Services Commission.

The new legislation includes doubling the payment that energy retailers must make to wrongfully disconnected customers, to $500 a day for each day that the customer’s supply is cut off, as well as a new $5,000 penalty that may be applied to energy retailers who make wrongful disconnections.

There is now also a $20,000 penalty for breaches of regulatory obligations, an increased penalty of up to $100,000 for non-compliance with a civil penalty notice and a ban on ‘exit’ or ‘early termination’ fees on retail energy contracts (excluding genuine fixed-term, fixed-price contracts) to enable customers to more readily change energy retailers.

Other amendments to the act include energy retailers having to publish standing offer prices on a specified date or in a specified period.

The Essential Services Commission will also be required to report publicly on the performance of each energy retailer, and on the compliance and enforcement action that it takes.

These new regulations went into effect on 1 January 2016.

VIC Minister for Energy and Resources, Lily D’Ambrosio, said, “Energy is an essential service for all Victorians. These strengthened consumer protection measures ensure the energy market continues to deliver positive outcomes for customers.”

While many energy companies act responsibly towards their customers, the Energy and Water Ombudsman Victoria received 34,524 electricity and 13,066 gas complaints and/or enquiries in 2015.  

The increased range of enforcement powers aim to provide greater incentives for companies to deliver on their consumer protection obligations. The new powers also mean that the Essential Services Commission is able to better protect consumers.

The Victorian Government said these new protections will deliver greater transparency and enable consumers to make more informed choices in the market, while also providing customers with greater confidence when dealing with energy companies.

Jessica Dickers

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