Power companies agree to provide clearer information to customers

Electricity company chiefs agree to give their customers more information about power plans after meeting Malcolm Turnbull.

Electricity consumers will be informed before their bills increase and be shown how their rates compare with the market under an agreement struck between the federal government and the nation’s three biggest retailers.

Prime Minister Malcolm Turnbull said the government had sought to “cut a better deal” for families as the he revealed electricity companies had agreed to tell their customers if they could get a better offer.

Under the deal, retailers agreed to write to customers who have reached the end of a discounted plan and outline alternative offers that are available.

“This could be included in the next household bill and it would include directing them to the Australian Energy Regulator’s Energy Made Easy comparison website or another objective independent comparison website,” Mr Turnbull said.

The announcement came after a meeting with the heads of AGL, Energy Australia and Origin Energy in Canberra this morning.

Retailers will have to tell customers “in plain English” that their discount period is ending and that they will move onto the standard rate. The consumer will be told how much extra this will cost every bill and be informed of alternative offers.

Mr Turnbull said that the retailers had also agreed to stop taking customers off a discounted plan if they were on a hardship program and they paid their bill late.

He said the extra information would help families make better decisions about their electricity plans.

“They are going to outline to the government and to the Australian Consumer and Competition Commission the steps they are taking as individual companies to help customers to better offers,” Mr Turnbull said.

“They have committed to producing clear user-friendly facts sheets on terms, late payment penalties, early termination payments, and to work with us and the Australian Energy Regulator on key components of this, including comparative rates. This is very important that people can understand what the alternatives are.”

Energy Minister Josh Frydenberg said energy retailers would write to most of their customers to inform them how their deal compares with the market.

“(The companies) represent 8 million customers, the bulk of those would have been on plans that have actually expired,” he said.

“So they will be contacting most of their customer base to let them know now what alternative offers are available and put them in touch with the comparable website. This is a significant course of action on behalf of the companies.”

Treasurer Scott Morrison said the agreement with the electricity retailers would give power back to consumers.

“The tools that we are putting in place here for customers to be stronger in the market, to take control over things that I know Australians feel frustrated about ...(that) they are at the mercy of big energy companies,” Mr Morrison said.

“What we are doing here is giving them more power back on their power prices. And I think that is one of the key issues that needs to be addressed - consumers having more opportunity to get a better deal, but also better understand how they are using energy themselves and how they can reduce their energy bills and have the tools and decisions that they could make to give effect to that.”