Regulation Impact Statement Updates

Official website for publishing regulatory impact analysis information for regulatory decisions announced by the Australian Government, COAG and COAG Councils.

Regulating Conditional Discounting

COAG
27th November 2019

COAG Consultation Regulation Impact Statement – Australian Energy Market Commission

On 21 November 2019, the Australian Energy Market Commission (AEMC) released a draft rule determination for the National Energy Retail Amendment (Regulating Conditional Discounting) Rule to amend the National Energy Retail Rules to limit the level of conditional discounts in energy retail contracts. The draft rule restricts conditional discounts and conditional fees to the "reasonable costs" the retailer is likely to incur when payment conditions are not met. The AEMC also released a corresponding Draft National Energy Retail Amendment (Regulating Conditional Discounting) Rule 2020 for consultation.

This draft rule restricts the level of conditional discounts and conditional fees (e.g. late payment fees) retailers can offer to the reasonable costs likely to be incurred by the retailer when a customer fails to comply with the payment condition. The draft rule protects customers by stopping retailers from recovering excessive costs from customers who fail to comply with certain payment conditions. The AEMC considers the draft rule in this format to be in the long-term interests of consumers in relation to the quality of energy services and customer protections and as a result, it will, or is likely to, contribute to the achievement of the national energy retail objective.

The draft determination has been assessed by the Office of Best Practice Regulation as compliant with requirements for a Council of Australian Governments Consultation RIS.

Submissions are invited by close of business, 16 January 2020. More information on the consultation process, including how to make a submission, can be found here.

Please note: the draft determination is web accessible in PDF only and any accessibility queries should be directed to the Australian Energy Market Commission.

 

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