Angus Livingston and Matt Coughlan
(Australian Associated Press)
Households could save more than $400 a year on power bills under a proposed major reset of Australia’s “broken” electricity market.
Businesses could also save up to $750 a year, and even as much as $2250 if they shop around for the best discounts.
The Australian Competition and Consumer Commission released its long-awaited report into the energy sector on Wednesday, detailing ways to tackle skyrocketing power costs.
It estimates bills could be slashed by 20-to-25 per cent for the average household if the report’s 56 recommendations are all implemented.
ACCC chair Rod Sims said serious affordability problems for consumers and businesses had been caused by poor policy decisions over the past decade.
“The national electricity market is largely broken and needs to be reset,” Mr Sims said.
More than two million small and medium businesses could save an average of 24 per cent on their bills under the ACCC’s recommendations.
Commercial and industrial customers could see electricity costs drop by 26 per cent.
Prime Minister Malcolm Turnbull said power companies have taken advantage of customers for too long.
“Australians are crying out for an energy policy that is focused on them,” he told an event in Brisbane on Wednesday.
“Lower prices, put the customer first, that’s my goal.”
The ACCC’s wide-ranging investigation into retail energy found the current situation is unacceptable and unsustainable.
The consumer watchdog wants the Australian Energy Regulator to be given more powers to target market manipulation.
Customers should be able to compare discounts from a default or benchmark rate set by the regulator.
“We cannot trust the retailers to set their own default prices to consumers,” Mr Sims said.
The report found there should be a cap on any further mergers or acquisitions by a company with more than 20 per cent market share.
It also recommends governments effectively underwrite the construction of new dispatchable power sources by guaranteeing long-term contracts for large industrial and commercial users.
The coalition is pushing for the states to adopt its national energy guarantee policy, which is aimed at bringing down prices while guaranteeing reliability and cutting emissions.
Mr Sims said the national energy guarantee was “a necessary step” to bring affordability to the market.
Labor energy spokesman Mark Butler said power prices had skyrocketed under Malcolm Turnbull, arguing divisions within the coalition had led to uncertainty.
“The ACCC report is the culmination of Malcolm Turnbull’s failures to produce an energy policy that his party room will allow him to tick off on,” he said.
The ACCC inquiry was commissioned in March 2017 by Treasurer Scott Morrison.