AER takes action against EnergyAustralia

The Australian Energy Regulator has instituted proceedings in the Federal Court against EnergyAustralia Pty Ltd for allegedly contravening the National Energy Retail Law by failing to obtain the explicit informed consent of customers before transferring them to new energy plans.

EnergyAustralia contracted Bright Choice Australia Pty Ltd to provide its telemarketing services during 2012 and 2013. Bright Choice contacted prospective customers on EnergyAustralia’s behalf to sell electricity and gas plans.

The AER alleges that, in a number of instances, Bright Choice sales agents signed up some customers residing in South Australia and the ACT to EnergyAustralia plans over the telephone without the customer’s knowledge or consent. A number of these customers were subsequently transferred to EnergyAustralia from their existing retailer.

"The National Energy Retail Law offers protections to customers who are signed up to a gas or electricity plan. These protections require a retailer to obtain the explicit informed consent of a customer to transfer the customer to a new energy retailer, or to enter the customer into a market retail contract,” AER Chair Paula Conboy said.

"The requirement for a retailer to obtain a customer’s explicit informed consent goes to the heart of consumer engagement in the energy market. The AER takes any failure to obtain explicit informed consent very seriously."

The AER is seeking pecuniary penalties, declarations, injunctions and compliance orders.

The AER's enforcement action follows an investigation undertaken by the AER in coordination with the Australian Competition and Consumer Commission into telemarketing practices by EnergyAustralia and Bright Choice.

The ACCC has instituted separate proceedings in the Federal Court against EnergyAustralia and Bright Choice relating to telemarketing conduct. The ACCC alleges that when dealing with certain consumers in Queensland, New South Wales and Victoria, Bright Choice and EnergyAustralia made false or misleading representations, and engaged in misleading or deceptive conduct, in contravention of the Australian Consumer Law.

Both proceedings have been set down for a directions hearing in Melbourne at 9:30 am on 13 February 2014 before Justice Gordon.

Background

The National Energy Retail Law requires a retailer to obtain the explicit informed consent of a customer to transfer the customer to a new energy retailer, or to enter the customer into a market retail contract.

In order for a customer to give their explicit informed consent, a retailer or a person acting on their behalf must clearly, fully and adequately disclose all matters relevant to the customer’s consent, including the purpose or use of the consent. A retailer must create a record of each explicit informed consent, which can be given by the customer in writing, verbally or by electronic communication.

The National Energy Retail Law currently applies in South Australia, NSW, Tasmania, and the ACT. Find out more at www.energymadeeasy.gov.au

Segment: 
Issued date: 
21 November 2014
AER reference: 
NR 20/14