Energy retailers are fast tracking a voluntary comparison rate for power prices that will let households easily rank the best energy discounts in the market.
The Australian Energy Council’s Chief Executive Sarah McNamara said the industry had developed a mechanism and structure to introduce a simple comparison rate and help customers identify the best offers.
“The new voluntary comparison rate will be set independently and will make it simpler for households to rank the best energy deals for them in the market.
“This will be a very useful tool for customers. The aim is to have this in place before the end of the first quarter of next year.”
A technical design paper outlining the concept has been circulated to energy ministers and key stakeholders ahead of next week’s COAG Energy Council meeting. Retailers have also been working closely with the Australian Energy Regulator and Federal Government on its proposed Default Market Offer which is targeted for completion by 30 April. In the meantime, the industry had agreed with Federal Energy Minister Angus Taylor to fast track this comparison rate to benefit households sooner.
“With this comparison rate all offers will be compared against the same rate,” Ms McNamara said.
“A reference bill in a network area for a 2-3 person household might be $1500 per year. If the retailer’s market offer is $1200 annually, they would be able to advertise it as 20 per cent cheaper. Another retailer with an offer of $1275 would be able to advertise that it is a 15 per cent discount.”
About the Australian Energy Council
The Council represents 23 major electricity and downstream natural gas businesses operating in competitive wholesale and retail energy markets. These businesses collectively generate the overwhelming majority of electricity in Australia and sell gas and electricity to over 10 million homes and businesses.
The Australian Energy Council welcomes the release of the Energy Security Board's advice to Energy Ministers, and in particular its call for coordination and a common approach by jurisdictions but notes there is still much work to be done on the detail.
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