AER takes action against Origin for alleged hardship breaches

The Australian Energy Regulator (AER) has instituted proceedings in the Federal Court against Origin Energy Electricity Limited (Origin). 

The AER alleges systemic failures in the automated processes Origin is using in relation to customers experiencing hardship and payment difficulties, in breach of the National Energy Retail Law and Rules.

Since January 2018, it is alleged that the automation of a number of Origin’s processes for dealing with customers experiencing hardship has resulted in Origin making unilateral changes to customers’ payment plans, failing to consider customers’ capacity to pay when establishing or changing payment plans, and cancelling payment plans in breach of Origin’s own hardship policies.

AER Chair Clare Savage said the issue of identifying consumers in financial difficulty and offering payment plans that have regard to a customer’s capacity to pay is an AER compliance and enforcement priority.

“We are very concerned about the alleged conduct by Origin, particularly the use of automation to make changes to hardship customers’ payment plans without first seeking their agreement,” Ms Savage said. 

“We consider that the energy law and rules require retailers to offer individualised assistance to these vulnerable customers, not an automatically generated outcome.”

As part of its case, the AER alleges that Origin failed to comply with its own hardship policies, which is demonstrated in its dealings with 18 individual customers who were experiencing financial difficulties. It is alleged that Origin failed to identify customers experiencing financial hardship, which meant they were not offered payment plans and, in some cases, were wrongfully disconnected.

Ms Savage said Origin’s alleged conduct was first brought to the attention of the AER by various state Energy Ombudsman offices, which received a number of individual complaints.

“While Origin’s alleged conduct is the focus in these proceedings, all energy retailers should be aware that the AER will take action to enforce the energy laws which require retailers to treat hardship customers appropriately within established hardship programs,” Ms Savage said.

The AER is seeking pecuniary penalties, declarations, injunctions, an order requiring implementation of a compliance program, a community service order, and costs.

Background

The National Energy Retail Law and Rules impose legal obligations on energy retailers in respect of their treatment of customers experiencing financial difficulties.

Issued date: 
24 August 2021
AER reference: 
NR 29/21
Contact: 
AER Media 0466 409 921 media@aer.gov.au