Affordability Through Simplicity: Why regulatory harmonisation and streamlining should be a priority

For too long, Australia’s energy retailers and their customers have faced a patchwork of rules, scripts, and billing requirements that vary from state to state, provider to provider, and scheme to scheme. While the intention behind these regulations is to protect consumers, the reality is that complexity can make it confusing for customers and often undermines the very outcomes the rules aim to achieve — especially for customers experiencing payment difficulties or living in non-traditional energy arrangements. 

The Australian Energy Council (AEC) has examined a range of regulatory opportunities aimed at improving the customer experience. The AEC and its members recommend a two-step approach: 

1. Pursue harmonisation of relevant laws and regulations to reduce inefficiency and inconsistency. 

2. Simplification of specific regulatory practices — starting with bill format rules and call scripting requirements — to create a more effortless customer experience. 

The following explores why this approach is needed, the opportunities it presents, and the potential risks and trade-offs that policymakers and industry leaders need to navigate. 

Step One: Harmonising Regulations Across Jurisdictions 

The case for harmonisation 

Australia’s energy landscape is fragmented. The National Energy Customer Framework (NECF) sets out consumer protections in most jurisdictions, but Victoria operates under a separate regime. Layer on top the federal rules, state-based schemes, environmental programs, and workforce regulations, and you have a web of obligations that’s hard to navigate — for both customers and retailers. 

This complexity creates three main problems: 

• Inconsistent protections: Two customers with similar needs can receive different levels of consumer protection simply because they live in different states. 
• Higher compliance costs: Retailers face duplicated processes, multiple sets of reporting requirements, and added administrative burden. 
• Barriers to innovation: Jurisdictional differences make it harder for retailers to roll out national services, test new products, or enter new markets. 

Harmonisation would simplify compliance, reduce costs, and improve outcomes for all consumers, particularly those in embedded networks or served by non-traditional providers. 

Key harmonisation opportunities 

1. Consumer protections: Aligning NECF protections and Victorian requirements would ensure that all customers — regardless of location — have access to the same baseline standards. This would not only reduce confusion for customers but also lower compliance complexity for retailers. 

2. Environmental schemes: Right now, energy efficiency schemes vary widely across states (we have previously undertaken a stocktake of the various jurisdictional schemes which you can read here. Each has its own certificate system, accreditation processes, and eligible activities. Moving toward a nationally consistent scheme, or at least harmonised state-based schemes, would streamline administration and reduce system costs. 

3. Workforce management: Licensing fees, apprenticeship rules, and supervisor requirements vary between states, making it harder to plan and move skilled workers across projects and regions. Nationally consistent trade licensing and accreditation could improve workforce mobility, especially in the rapidly growing clean energy sector. 

Step Two: Simplifying Specific Regulatory Practices 

If harmonisation addresses the “big picture” inefficiencies, simplification tackles the day-to-day customer pain points that create unnecessary frustration and cost. 

Rethinking billing guidelines 

The Australian Energy Regulator’s Better Bills Guideline was designed to make energy bills simpler. But feedback from retailers and customers suggests that in some cases, it has had the opposite effect. Restrictions on information and strict tiering rules have reduced flexibility and, for certain customers, made bills harder to understand. 

Examples of unintended consequences: 

• Complaint escalation confusion: The Ombudsman’s number is more prominent than the retailer’s, leading customers to bypass the retailer entirely when they have a problem. In the first instance a customer will need to approach their retailer to try to resolve the issue before the Ombudsman will consider it. 

• Multi-site complexity: Businesses with multiple locations struggle to work out which charges relate to which site under the new bill structure. 

A review, informed by customer feedback, could restore flexibility so that bills can be tailored to different cohorts, while still meeting transparency and fairness objectives. 

Fixing regulatory scripting 

Call centre agents are bound by prescriptive scripts for key processes such as Explicit Informed Consent (EIC) and the Best Available Offer. While designed to protect consumers, these scripts can be long, complex, and alienating. It can and does lead to customer frustration. 

Key issues: 

• Friction at sign-up and offer checks: Straightforward processes like signing up or checking for the best deal become lengthy and repetitive. 
• Robotic delivery: Even with empathy training, agents may sound transactional because they must read scripts verbatim. 
• Repeated effort for vulnerable customers: Customers in payment difficulty often face the same long script every time they call, even if they are repeat contacts. 
• EIC outdated for modern contracts: Requirements have not evolved to reflect changes like default offers and the removal of exit fees. 

Real-world example: A customer calling for a simple payment extension must sit through a lengthy set of payment difficulty options, even if they’ve heard it all before. This frustrates customers and erodes goodwill. 

The preferred solution would allow for simpler, plain-language conversations, with the option to send regulatory information in writing after the call. 

Navigating Risks and Trade-offs 

While the benefits of harmonisation and simplification are clear, there are strategic considerations to keep in mind. 

• Complex reform environment: The NECF is a multi-layered regulatory system. Any changes risk triggering unintended consequences. 
• State-based opportunities vs. national consistency: Victoria could be a more straightforward test bed for flexibility reforms but going it alone risks widening the gap with NECF jurisdictions. 
• Link with BECE review: The Better Energy Customer Experiences (BECE) process could provide a vehicle for pursuing these reforms, but its focus — especially if a Consumer Duty is introduced — may shift resources away from billing and scripting improvements. 
• Consumer Duty implications: While a Consumer Duty could embed better outcomes into regulation, it could also expand regulatory obligations beyond the current scope, increasing complexity if not carefully managed. 

Strategic Advocacy Pathways 

Given these dynamics, the AEC will explore the following opportunities: 

1. Engaging with intergovernmental forums to push for NECF and Victorian alignment. 

2. Promoting national alignment of environmental certificate schemes to reduce duplication. 

3. Advocating for nationally consistent trade licensing to support workforce mobility. 

4. Feeding customer experience evidence into the AER’s Better Bills Guideline review to make the case for flexibility. 

5. Working with consumer groups to show that simpler scripting can maintain protections while improving customer experience. 

6. Influencing the BECE process to ensure that harmonisation and simplification remain priorities alongside any Consumer Duty framework. 

Conclusion 

Energy affordability is shaped not just by wholesale prices or network costs, but by the complexity — and sometimes inefficiency — of the regulatory framework. Harmonisation of laws and processes across jurisdictions, combined with targeted simplification of customer-facing rules, offers a practical path to better outcomes for both consumers and retailers. 

The two-step approach recommended by the AEC provides a roadmap: first, address the structural inefficiencies that create uneven protections and high compliance costs; then, make targeted changes to the rules that shape everyday customer interactions. 

The prize is worth the effort: lower costs, more consistent protections, and a more effortless customer experience that restores trust in the energy market.