Retail Pricing Information Guidelines review 2019

Segment: 
Category: 
Retail pricing information
Status: 
Date initiated: 
27 June 2019
Effective date: 
1 October 2019
Contact: 
General enquiries - Retail pricing information guidelines RPIGconsultation@aer.gov.au

Overview

On 27 June 2019, the AER released the draft version 6 of the Guidelines for consultation, proposing minor updates to reflect the new Electricity Retail Code (the Code).

In 2019, the AER decided that, due to a range of external developments and policy issues, it would not be practicable to proceed to amend the Guidelines.

In March 2020, the AER notified stakeholders through our Statement of Expectations of Energy Businesses that we would pause our plans to consult on updates to the Guidelines during 2020 in light of the global COVID-19 pandemic.

The AER Strategic Plan 2020-2025 notes the AER will improve consumer outcomes while reducing costs to serve by boosting consumer and behavioural insights and applying them across AER initiatives (e.g. guidelines, better bills, Retail Pricing Information Guidelines, hardship/Sustainable Payment Plans Framework).

We are continuing to work, along with other market bodies, to review the timing of current and upcoming regulatory initiatives and approaches we all have underway (including the review of the Guidelines) and how these might need to continue to change so energy businesses can focus on their business and support their customers. Subscribe here to receive updates about these and other AER developments.

More information

During June/July 2019, the AER consulted on the draft Guidelines. We proposed making minor changes to reflect the new Code. Submissions on the draft Guideline closed 26 July 2019.

The Code made two key changes from 1 July 2019:

  • implemented the new ‘reference price’ that is a maximum standing offer price for electricity supply to small customers, informed by the new ‘default market offer’ set by the AER, to protect consumers who do not engage in the market for one reason or another; and
  • new requirements to ensure that the most prominent price-related feature in an advertisement must not be a ‘conditional discount’, and any conditions on discounts must be clearly displayed.

More information about the Code

The AER and the ACCC jointly commissioned research from the Behavioural Insights Team, Testing Comprehension of the Reference Price. This research provides new insights about the ways consumers understand electricity offers and the AER and the ACCC will use these insights to consider how the presentation of electricity offers could be improved.

The draft Guidelines are accompanied by the Notice of Draft Instrument, which explains the development of the draft Guidelines, as well as other actions that the AER will be undertaking this year in relation to the Guidelines.

For further information on the Guidelines consultation process, please consult our frequently asked questions (FAQs).

Background

Under the National Energy Retail Law, the AER may develop and amend Retail Pricing Information Guidelines (the Guidelines). The Guidelines are the main regulatory instrument that specify the manner and form in which retailers must provide pricing information to customers when advertising and marketing energy plans. The Guidelines also provide direction to energy retailers about providing data and information to the AER for the purposes of our energy price comparison website, Energy Made Easy.

The Guidelines play an important role in educating consumers and empowering them to engage in the retail energy market and make more informed and efficient decisions. By specifying the manner and form in which information is presented by retailers, we aim to create a clear and consistent form of presenting important information to customers, giving them confidence in the accuracy and comparability of this information.