Energy retailing failure means Government needs to re-regulate: Grattan Institute


Competition in energy retailing has failed and the Government might need to re-regulate the sector to protect consumers, according to a report.

Competition in energy retailing has failed and the Government might need to re-regulate the sector to protect consumers, according to a report.

The Grattan Institute study also confirms a power bill "shock" in Sydney, Melbourne and Brisbane, with retail prices doubling over the past decade.

The report comes as Prime Minister Malcolm Turnbull prepares to meet energy company bosses to confront what some have described as a looming energy catastrophe.

Grattan's energy program director, and former energy company executive, Tony Wood said Mr Turnbull could wield a "re-regulation" stick to force energy companies into line and to provide a better deal for consumers.

"Ultimately the government may have to threaten the use of a big stick in a regulatory intervention of some sort knowing that it almost certainly won't be the best way to achieve the outcome," Mr Wood told the ABC's AM program.

"But if industry doesn't get on top of things like gas supply, then the government will be forced to intervene.

    "Industry should know that if they don't fix the problem then the government will have no choice but to wade in and they might not like the way they wade in."

The report titled 'Price shock: Is the retail energy market failing consumers?' says it is too early to give up on competition and warns that retailers need to ensure customers get better prices and services.

The study singles out Victoria where the profit margin for energy retailers is 13 per cent and double the margin that regulators once considered fair.

It said Victorians would save around $250 million a year if the margin for state electricity retailers matched the national average.

The Grattan Report also claims that the way retailers advertise special discounts are confusing and sometimes misleading.

The study points to an advertised 30 per cent discount on one product that only applied to a portion of a bill rather than the entire bill.

But Mr Wood stopped short of accusing energy retailers of gouging consumers with higher prices.

    "I'm not suggesting that regulation is necessarily the best answer but neither is the current market arrangement," Mr Wood said.

"The industry is on notice. We may yet see a better service. But if not the government will have no choice but to return to price regulation."

The report suggests that in the absence of government regulation, retailers should be forced to report the data behind their profit margins to an independent agency such as the Australian Energy Market Commission.

http://www.abc.net.au/news/2017-03-13/competition-in-energy-retailing-has-failed-grattan-institute/8349602




they should never have put it in the hands of private industry

It hasn't failed the real agenda.

Govco made some money.
Politicians and public servants got some bribes.
Private industry are making squillions.
The people have to pay, pay and pay.

Fits all the Grubberment agendas, don't it?

John Smith wrote on Mar 13^th, 2017 at 10:47pm:

Energy retailing failure means Government needs to re-regulate: Grattan Institute Competition in energy retailing has failed and the Government might need to re-regulate the sector to protect consumers, according to a report. Competition in energy retailing has failed and the Government might need to re-regulate the sector to protect consumers, according to a report. The Grattan Institute study also confirms a power bill "shock" in Sydney, Melbourne and Brisbane, with retail prices doubling over the past decade. The report comes as Prime Minister Malcolm Turnbull prepares to meet energy company bosses to confront what some have described as a looming energy catastrophe. Grattan's energy program director, and former energy company executive, Tony Wood said Mr Turnbull could wield a "re-regulation" stick to force energy companies into line and to provide a better deal for consumers. "Ultimately the government may have to threaten the use of a big stick in a regulatory intervention of some sort knowing that it almost certainly won't be the best way to achieve the outcome," Mr Wood told the ABC's AM program. "But if industry doesn't get on top of things like gas supply, then the government will be forced to intervene.     "Industry should know that if they don't fix the problem then the government will have no choice but to wade in and they might not like the way they wade in." The report titled 'Price shock: Is the retail energy market failing consumers?' says it is too early to give up on competition and warns that retailers need to ensure customers get better prices and services. The study singles out Victoria where the profit margin for energy retailers is 13 per cent and double the margin that regulators once considered fair. It said Victorians would save around $250 million a year if the margin for state electricity retailers matched the national average. The Grattan Report also claims that the way retailers advertise special discounts are confusing and sometimes misleading. The study points to an advertised 30 per cent discount on one product that only applied to a portion of a bill rather than the entire bill. But Mr Wood stopped short of accusing energy retailers of gouging consumers with higher prices.     "I'm not suggesting that regulation is necessarily the best answer but neither is the current market arrangement," Mr Wood said. "The industry is on notice. We may yet see a better service. But if not the government will have no choice but to return to price regulation." The report suggests that in the absence of government regulation, retailers should be forced to report the data behind their profit margins to an independent agency such as the Australian Energy Market Commission. http://www.abc.net.au/news/2017-03-13/competition-in-energy-retailing-has-failed-grattan-institute/8349602 they should never have put it in the hands of private industry

A double ditto/amen to that.

We are being robbed wholesale.(and retail)

Rabid greed & dishonesty is rampant in all sectors of private enterprise.

essential services should never be privatised

https://www.youtube.com/watch?v=qKUbTGoRP0I

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