This report analyses the potential for, and extent of barriers to, effective consumer participation in the Victorian energy market. It makes recommendations as to how the Victorian retail market could be improved and simplified for consumers.
Some of the key findings of the research relate to the level of understanding of Victorian consumers in the energy market. The report, in line with previous reports from the Essential Services Commission and the Australian Energy Market Commission, finds that many Victorian consumers find it difficult to understand offer information. In fact, 42 per cent of consumers surveyed as part of this research indicated that they found it difficult to understand offer information. This compared to the 32 per cent who found it comparatively easy.
The research also provides evidence of ongoing problems of mis-selling by door to door sales representatives and difficulties finding reliable information through other channels such as commercial price comparison services. This compromises the ability of consumers to access quality information upon which to make well-informed consumption decisions.
The findings suggest that the effectiveness of consumer participation in the Victorian market is less than optimal and may not be placing adequate competitive pressure on energy retailers. A number of recommendations are made in the report that include:
approaches to improve the simplicity and comparability of offers through regulatory reform;
the introduction of an education and information program for Victorian energy consumers;
the introduction of a regulatory code in order to improve comparison services; and
the development an energy retailer rating scheme.
CUAC hopes that this report will be closely considered by all stakeholders so that we can achieve improvements to both the Victorian and national market in the interests of all energy consumers.
CUAC will be hosting an event involving all stakeholders to discuss the findings of the report in further detail early in 2012. Keep an eye out for future announcements of this event so that you can participate in this important policy debate.
See also: Highlights from Improving energy market competition through consumer participation