The Victorian Government has made changes to the Energy Retail Code of Practice, in an effort to lower energy bills and increase protections for customers experiencing financial hardship.
Victorian Minister for Energy and Resources, Lily D’Ambrosio, said that these changes to the Code of Practice makes them the strongest in the nation and are expected to put $258 back into the pockets of Victorians each year.
Under the updated regulations, energy retailers will be required to automatically switch customers in payment difficulty, and customers who have had debt on their energy bill for more than three months and more than $1000 debt, onto their best offer. The Victorian Government estimates that this will save 75,000 electricity and 60,000 gas customers a total of $27.8 million per year. Customers can still choose to opt-out.
The Australian Energy Council (AEC) said that electricity retailers stand ready to further support customers facing payment difficulties,
AEC Chief Executive, Louisa Kinnear, said it supported the goal of ensuring customers facing financial difficulties are on the most appropriate energy plan to meet their needs.
“We support the extension of protections for customers on legacy contracts,” she said.
“Retailers have been limited in being able to move customers to different plans because of the need for explicit informed consent. These changes mean they will now be able to automatically switch customers in payment difficulties to plans that better suit them.
“We always encourage customers to shop around to get the best deals but there are still around five per cent of customers who haven’t changed plans and are missing out on potential savings.”
The State Government said that Victorians on older contracts often pay higher rates because they haven’t switched plans, which is why it’s also introducing a reasonable price limit on energy plans over four years old.
It has also raised the minimum debt amount that customers must have before a retailer can try to disconnect them from $300 to $1,000.
Ms Kinnear said that help is available for customers experiencing payment difficulties, and encouraged Victorians to approach their energy retailer for a confidential discussion.
“We recognise that not everyone may feel confident about doing that but a confidential conversation with your retailer can help you to understand your options,” she said.
“Retailers offer a range of assistance measures on request. If you are concerned that you may not be able to afford to pay your bills as they fall due, contact your retailer as soon as possible.
“Retailers will work with customers to find the best way to manage debt levels.”
Ms Kinnear said disconnections remain a last resort for retailers and only occur after all other measures have been exhausted. With the new higher threshold, there will be an increased need for all stakeholders to encourage early engagement to ensure customers do not accrue higher levels of debt.
The AEC has also called for the Victorian Government to review the adequacy of its emergency relief and other support measures in light of the higher disconnection threshold.
Other changes to the Energy Retail Code of Practice include capping fees for things like paying bills at the post office or paying late, and banning direct debit only offers – so that customers who don’t or can’t pay via direct debit can access cheaper offers.
For some low-income families, direct debit is hard to manage when payments are taken straight from their account which can lead to additional bank fees or overdrawn accounts if their balance is low, adding financial stress.
The State Government also said these changes require energy retailers to check their customers are eligible for an energy concession more often, so customers can access savings of up to $260 per year, if their circumstances change and they become eligible.
For energy immediate energy bill relief, Victorians with an eligible concession card can apply for the $100 Power Saving Bonus now, and the State Government said that so far more than 141,000 applications have been received.
These reforms will be enforced by the independent Essential Services Commission (ESC), taking effect in stages, from February 2026.
More information can be found at esc.vic.gov.au/electricity-and-gas.
