EnergyAustralia apologises for misleading conduct
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More news: EnergyAustralia has said it is "sincerely sorry" for its failure to provide clear and accurate information to consumers on electricity pricing over a period between June and September 2022.
The company has said it has made significant improvements to its governance since the conduct took place.
What they said: EnergyAustralia managing director, Mark Collette, said: “We acknowledge this $14 million penalty reflects the seriousness of the failure in our duty to provide clear and accurate information to customers. We are sincerely sorry".
"Once we became aware of the issue, we took immediate action. We sought to contact every customer impacted by this issue, as well as reviewed our pricing processes and customer communication. We have made significant improvements to our governance.
"We are continually investing in systems to uplift our customers’ experience. We are also working with our teams to ensure that we identify any issues and rectify them as quickly as possible."
EnergyAustralia faces $14m fine for breaching electricity code
The news: EnergyAustralia must pay a $14 million penalty for making false, misleading or deceptive statements over electricity prices and failing to provide mandatory information required by an industry code of conduct, the Electricity Retail Code.
The numbers: EnergyAustralia had admitted to breaching Australian Consumer Law and the industry code in communications sent to 566,827 consumers between June and September 2022 over changes to the company's electricity prices.
The communications, sent in writing, failed to state the lowest possible price for a representative customer clearly and conspicuously, or at all, according to a decision handed down today by Federal Court of Australia Judge David O'Callaghan.
EnergyAustralia also admitted that online offers published between July and September 2022 failed to state the difference between the reference price and the unconditional price expressed as a percentage of the reference price, and the lowest possible price. Those offers were viewed on 223,591 occasions, according to the court judgment.
EnergyAustralia must also pay $50,000 for the Australian Competition and Consumer Commission's (ACCC's) legal costs.
The context: EnergyAustralia and the ACCC had proposed the $14 million penalty to the court in September.
A $4 million penalty related to breaches of the industry retail code by failing to provide mandatory pricing information in offers on its website.
A $10 million penalty was linked to alleged breaches of consumer law and of the retail code in letters to customers.
The ACCC announced the lawsuit in September 2023, with the alleged conduct taking place over a period of months in 2022.
This is the first time a breach of the electricity retail code has been the subject of a lawsuit before the Federal Court.
The company has 30 days in which to pay the penalty.
EnergyAustralia must also appoint a compliance professional, approved by the ACCC, to review internal training and compliance, with regular reports to be provided to the regulator.
What they said: In a statement following today's judgment, ACCC chair Gina Cass-Gottlieb said “EnergyAustralia’s failure to fully inform consumers meant they could not accurately compare offers from competing retailers and may have been denied the opportunity to choose the best deal for them".
“Some consumers may also have been misled by EnergyAustralia’s statements into thinking that a price change was less than it actually was, causing them to stay with their existing plan when in fact a different plan may have represented a better deal,” Cass-Gottlieb said.
The sources: ACCC media release, Federal Court of Australia , EnergyAustralia
