Victorian Energy Market report 2018-19

We regularly review the Victorian energy rules to promote the long-term interests of Victorian consumers. In 2018–19, we made several changes to the energy rules that affect the way in which customers experience the energy market. 

The changes which came into effect during the year included:

• retailer’s must tell you if you’re on their ‘best offer’ for you and warn you of any upcoming price or benefit changes 
• simple and accessible fact sheets must be provided for all energy deals
• the Victorian Default Offer was introduced from 1 July 2019
• the ability to self-read your gas meter if you receive an estimated bill 
• updated minimum feed-in tariff rates for customers who own solar panels
• increased protections for customers living in embedded networks.

Your retailer’s best offer on energy bills and prior warning of changes to prices or benefits

In 2017, an independent review of the Victorian energy market found competition was not working effectively for consumers.

The Victorian Government supported the recommendations and issued terms of reference to us to deliver many of the reforms.

We have recently focused on changing the energy rules to unlock the complexity customers experience when participating in the retail energy market. 

The following new rules started from 1 July 2019:

• Retailers must notify you regularly about their best offer on energy bills – at least once every three months for electricity and once every four months for gas. It must include how much you could save if you switch to a better offer.
• Retailers must notify you at least five business days before any price or benefit changes that will affect your bill. 
• Retailers must provide you with clear advice before you sign a new energy deal. They must help you navigate to a product that best suits your circumstances.
• Retailers must provide GST inclusive pricing on bills and in marketing material.

Simple and accessible energy fact sheet 

From 1 July 2019, retailers are required to provide energy fact sheets to help customers assess and compare energy offers. 

They must include information about available offers in a consistent format, including a table comparing the average yearly cost for a range of typical customers (e.g. household size) to help you easily compare plans. 

The Victorian Default Offer 

In December 2018, the Victorian Government asked us to provide the methodology to calculate a “simple, trusted and reasonably priced electricity option’ to be known as the Victorian Default Offer. 

The VDO came into effect on 1 July 2019, for around 160,000 residential and small business customers who were on simple standing offers for electricity. 

Estimated savings for these customers ranged from $310 to $450 for residential customers, and $1,380 to $2,050 for small business customers. 

The VDO is available to all residential and small business customers on request. 

Provide your own meter reading to prevent estimated bill shock

In early 2018, we received reports customers were receiving high estimated bills, leading to ‘bill shock’ for some.

At times, your retailer can estimate your energy use for billing instead of measuring the actual usage from your meter. They can do this if, for example, they cannot physically access the meter or do not have reliable data from the meter.

We changed the rules to allow customers to provide a read of their own energy meters. This means you can provide your own meter reading, for example by taking a photo of your gas meter, so they can adjust your bill to accurately reflect your usage.

Self-reads can only be submitted for electricity if your property does not have a smart meter.

The new rule came into effect 1 July 2019.

Updated minimum feed-in tariff rates offered by retailers

Each year we set the minimum feed-in tariffs that retailers can credit customers for the electricity they export to the grid from sources like rooftop solar.

The feed-in tariffs change annually to reflect the latest information on the wholesale price of electricity and avoid losses through the network. 

From 1 July 2019 until 30 June 2020, the minimum single rate feed-in tariff will be 12.0 cents per kilowatt hour.

We have also set a time-varying feed-in tariff which varies between 9.9 and 14.6 cents per kilowatt hour depending on when the power is exported to the grid.

Increased protections for customers living in embedded networks

During 2018–19 we registered over 1,100 embedded networks that supply over 140,000 customers.

We also clarified the rules around customer protections and provided customers in embedded networks with comparable protections to other Victorian electricity customers. 

These protections started on 1 January 2019 and broadly include obligations about:

• access to free, independent dispute resolution thought the Victorian Energy and Water Ombudsman
• explicit informed consent 
• billing, including contents and information on bills, basis for bills, frequency of bills
• payment methods, undercharging and overcharging, additional retail charges and merchant fees 
• payment difficulties assistance and payment plan options, restrictions on debt recovery for residential customers experiencing payment difficulties, a prohibition on security deposits for residential customers
• general information about interpreter services, provision of information to customers 
• reminder notice and disconnection warning, notice requirements 
• disconnection and reconnection requirements 
• life support equipment requirements.
• access to free independent impartial dispute resolution