Right to data power move to help cut energy bills

Finding a cheaper energy deal is about to get simpler, with consumers now able to make their retailer securely share exact usage information with comparison services.

Australia has become the first country in the world to roll out the so-called “consumer data right” to energy.

One of life’s least enjoyable and more confusing tasks – finding a cheaper energy deal – is about to get simpler and more rewarding, with consumers now able to make their retailer securely share exact usage information with comparison services.

Amid official warnings that electricity prices are likely to rise by another 56 per cent before the end of next year and that gas providers are gouging, Australia has become the first country in the world to roll out the so-called “consumer data right” to energy.

Financial Services Minister Stephen Jones told The Daily Telegraph that the consumer data right, or CDR, would help people who wanted to lower their bills but lacked the time and expertise to wade through the mind-numbing minutiae of consumption patterns.

“This is aimed at smashing the loyalty tax and the busy tax,” Mr Jones said.

Experts such as UNSW professor Ross Buckley have predicted the CDR will trigger a “revolution” in commerce by transforming competition and making it easier to budget and keep a lid on household costs.

Minister for Financial Services, Stephen Jones. Pictures: Britta Campion

The CDR gives households and small business owners secure access to their detailed usage and billing information so they can share it with comparison services that have been accredited by the federal government.

According to the Australian Competition and Consumer Commission (ACCC), a householder or small business would start by giving consent to the comparison service to access the energy consumption data.

This would trigger an identity check by the existing retailer of electricity or gas, via a one-time password.

The comparison service and energy retailer’s websites or apps would then link with each other. After the consumer confirms the data they want to share, the information is transferred to the comparison service, meaning the quotes generated will be much more accurate because they are based on real data.

Mr Jones said the CDR would allow households and small businesses to get the “best deals available”.

Major energy retailers including AGL and Origin, which both have millions of customers, have already been signed up to provide customer data.

The next step, Mr Jones said, was for comparison services to begin offering analysis using the CDR.

“We think it will move pretty quickly,” he said.

Mr Jones said he expected the federal government’s own electricity and gas comparison service, Energy Made Easy, to soon start using the CDR.

“There is plenty of evidence that retailers are price gouging and there is plenty of evidence that competition can drive those prices down,” he said.

This week, the ACCC said gas retailers had increased consumer prices by 95 per cent this year.

Mr Jones said the forecast for further big increases in energy charges made the CDR more relevant and useful to consumers.

The CDR was the brainchild of former Productivity Commission chief Peter Harris and Scott Morrison when he was treasurer.

The first sector it was applied to was banking, which happened last year. There is not any research yet into the savings delivered.

Mr Jones said the CDR would be rolled out to telecommunications next. Insurance and superannuation are likely to follow.