Energy companies to be penalised for profiteering from late payment fees in AEMC rule change

In an irony sure to please many energy consumers, power companies that profiteer from late payments will be hit with penalties for doing so.

In an irony sure to please many energy consumers, power companies that profiteer from late payments will be hit with penalties for doing so.

The move could save thousands of households hundreds of dollars a year.

The Australian Energy Market Commission will today unveil new rules to regulate pay-on-time discounting in electricity and gas contracts.

Penalties for missing deadlines have reached as much as 40 per cent in the past, said AEMC Acting CEO Suzanne Falvi.

“So, depending on how much energy a household uses, this could cost them as much as several hundred dollars a year,” Ms Falvi said

In 2018, the Australian Competition and Consumer Commission found more than one in four residential electricity customers failed to get their pay-on-time saving.

The rules will cap the level of conditional discounts and fees to a “reasonable cost”.

The Australian Competition and Consumer Commission identified the problem in its retail electricity pricing inquiry in 2018.

Energy Minister Angus Taylor said: “We are protecting consumers from dodgy retailing practices, and making sure discount deals are fair and transparent.”

Energy Minister Angus Taylor. Picture: AAP Image/Mick Tsikas

Earlier this week, it emerged that EnergyAustralia’s earnings had fallen by $300 million due to other reforms imposed by the government to bring down prices.