Why did the NSW Government remove retail electricity price regulation?

Visit yourenergy.nsw.gov.auRemoving electricity price regulation has promoted greater competition in the market, and encouraged more retailers to operate in NSW, offering better electricity deals.

Price regulation was removed after the Independent Pricing and Regulatory Tribunal (IPART) and the Australian Energy Market Commission (AEMC) released reports in 2013 finding the State's electricity market is competitive, price regulation is unnecessary and the AEMC went on to say that regulation may be inhibiting price competition.

Watch 'The power is in your hands' videoThe NSW electricity market has largely already shifted away from regulated pricing to market offers. Around 80% of NSW households and small businesses have already made the switch from the regulated price and into the market.

Since 1 July 2014, approximately 438,365 or 40 per cent of customers who were on the transitional tariff have moved to another electricity offer, while around 20 per cent of the state's 3.3 million electricity customers remain on the transitional tariff.

IPART's Final Report: Review of the performance and competitiveness of the retail electricity market in NSW PDF (1.53 MB) found that in the first year of electricity price deregulation, the market is working effectively.

IPART's report found that the deregulation of retail electricity prices was a major reason for four new retailers entering the NSW market and for small retailers increasing their market share.

How do I know if I was on a regulated contract?

You were on a regulated contract before 1 July 2014 if you had not signed up to an electricity contract with a fixed-term period, discount or other incentive. Only Origin Energy and EnergyAustralia currently offer regulated contracts.

If you are unsure what kind of contract you have, you can phone your electricity retailer to find out.

EnergyAustralia's number is 131 502 and Origin Energy's number is 13 24 61.

If you are on a standing offer or market contract, your electricity retailer already determines your electricity prices.

I'm a household, how will electricity price regulation removal affect me?

There will be no change for customers who have already moved to a market contract.

For 'small customers' who remained on regulated contracts on 30 June 2014, the NSW Government approved transitional tariff arrangements.

A small customer is defined as a customer that consumes less than 100 megawatt hours of electricity per annum.  This includes households and most small businesses.

From 1 July 2015 the average price increase for these customers will be capped at the level of the Consumer Price Index (CPI).

At the end of this transitional tariff period, any household remaining on the transitional tariff will be moved to their retailer's default standing offer on 1 July 2016.

For customers who have chosen a market offer, IPART's final report on deregulation found households could save up to $389 to $522 by switching to the lowest priced market offer.

I run a small business, how will electricity price regulation removal affect me?

For 'small customers' who remained on a regulated contract on 30 June 2014, the NSW Government approved transitional tariff arrangements to apply from 1 July 2014.

A small customer is defined as a customer that consumes less than 100 megawatt hours of electricity per annum. This includes households and most small businesses.

On 1 July 2015, the small business transitional tariff ended and customers who had not already taken up a market contract were moved onto their retailer's default standing offer. IPART's final report on deregulation found changes in small business standing offers from June 2014 to June 2015 saw retail electricity prices also decline between $125 to $438.

Will my rights or electricity supply change?

Existing customer protection measures have not been altered by the removal of retail electricity price regulation.

Customers still have access to energy rebates, hardship programs and payment plans. There are also protections around disconnection.

Customers still have the same quality of electricity supply, regardless of their electricity retailer.

All of these protections remain unchanged.

In fact, the NSW Government strengthened customer protections by giving the Independent Pricing and Regulatory Tribunal (IPART) a new market monitoring role. IPART will conduct annual reviews to make sure competition is still effective in NSW.

The monitoring of the electricity market gives the NSW Government advanced warning of any changes in competition.

This will allow the Government to act to ensure customers continue to benefit from a competitive market.

I'm having trouble paying my bill. What help is available?

The NSW Government offers a number of rebates to help customers pay their energy bills. These rebates include:

  • Low Income Household Rebate - for customers who hold eligible concession cards issued by the Federal Department of Human Services or the Department of Veterans Affairs
  • Family Energy Rebate - available to customers who have received the Family Tax Benefit
  • Life Support Rebate - for households where residents use certain medical equipment necessary to sustain life
  • Medical Energy Rebate - for eligible customers who have a medically diagnosed inability to self-regulate body temperature when exposed to extremes of environmental temperatures
  • Gas Rebate - to help eligible customers to pay for their natural gas bills

The NSW Government also funds the Energy Accounts Payment Assistance (EAPA) Scheme which helps people experiencing a short term financial crisis or emergency to pay their electricity or gas bill. The scheme helps people stay connected to essential energy services during a financial crisis. EAPA is administered by participating community welfare organisations.

In addition to NSW Government assistance, retailers may offer customers flexible payment options, such as an extension on the bill due date, or other programs to help customers better manage their energy bills. Contact your retailer if you think you would benefit from one of these options.

There are also protections in place regarding contract terms and conditions as well as rules around disconnections.

What happened to customers who were still on a regulated contract on 1 July 2014?

From 1 July 2014 any customers who had not switched over to a market contract were automatically transferred to a 'transitional tariff'.

The purpose of the transitional tariff is to serve as a safety net for regulated customers in their move to a market contract.

At the end of the transitional tariff arrangements on 30 June 2016 customers who have not already taken up a market or standing offer contract will move onto their retailer's default standing offer.

How can I find a better electricity deal?

For a free and independent comparison service for energy offers visit the Australian Energy Regulator's Energy Made Easy website or call 1300 585 165.

The Energy Made Easy website lists all possible energy offers, not just offers from selected retailers, so it is the best way for you to shop online for an energy contract.

When was price regulation removed?

Retail electricity prices were deregulated on 1 July 2014.

This means that the Independent Pricing and Regulatory Tribunal (IPART) will no longer set any prices for electricity.

Instead, IPART will monitor the electricity market to ensure it remains competitive and is operating effectively.

How do I change retailers?

Changing retailers is an easy process. You can enter into a contract with a retailer in person, over the phone, by mail or by email.

When you enter into a new contract, your new retailer must provide you with a copy of the contract and an Energy Price Fact Sheet. These will include details about:

  • the start date of the contract
  • prices, early termination fees, and billing and payment arrangements
  • your right to make complaints and instructions for who to contact
  • information about the cooling-off period.

By law, you have a cooling-off period of 10 business days if you sign a new contract and you change your mind.

When you enter a new contract, your existing contract is automatically cancelled and you will be sent a final bill from your old retailer. This process may take a few months from the time you enter a new contract as the transfer cannot occur until after your next meter reading.

Contract cooling-off period

By law, you have a cooling-off period of 10 business days if you sign a new contract and you change your mind. This means you can cancel your new energy contract within the cooling-off period without having to pay any costs. You should take this time to carefully read through the contract. If you cancel during this period you will remain on your current plan.

What should I think about when changing retailers?

Some of the things you should consider when looking for a better electricity deal include:

  • How does the tariff compare to your current arrangements? You should consider your meter type, what time of day you use the most power and hot water service.
  • Are there any discounts that may be applied to the entire bill or parts of the bills?
  • Will the usage (cents per kilowatt hour or c/kWh) charge or the fixed service charge (cents per day) change or are these fixed? Check which charges can change.
  • How long will the contract last? What happens when it ends?
  • Are there any fees to change the address?
  • What are the fees and charges? There may be a range of fixed fees and charges, including late payment fees and contract exit fees. In some cases, if you pay your bill late, you may not only lose any pay-on-time discount, but may also be charged a fee.

Customers who are looking for advice on switching retailers can visit:

www.energymadeeasy.gov.au/checklist or phone 1300 585 165.

For more tips, visit the Energy and Water Ombudsman NSW (EWON)

Importantly, it pays to shop around so you can compare prices and services. If you feel pressured by time, don't sign or agree to anything. You can tell the marketer you will get back to them after you have read and considered everything. Ask someone you trust or an independent advisor to review the contract terms before you agree or sign. If need be, you can contact the Financial Rights Legal Centre on 1800 007 007 for advice on contracts or a referral.

What are my rights if I am contacted by a salesperson about an energy contract?

You have rights under the Australian Consumer Law when a salesperson approaches you at your front door, over the phone or in a public place. These rights cover things such as:

Any person selling you an energy contract must provide you with an Energy Price Fact Sheet. In addition, if a salesperson contacts you, they must tell you who they are and why they are contacting you.

If the contact is in person, they must show you identification and leave your home or property if you ask them to.

If you sign up to a new energy contract, the salesperson must give you a written copy of the sales agreement, inform you of your right to cancel the contract and the steps to do this, and not ask you to waive your right to cancel within the cooling off period.

Salespeople for energy retailers cannot force or pressure you into signing up to an energy contract or to buy services you are not interested in.

You can also ask to be placed on any energy retailer's 'do not contact' list which means they cannot contact you by email or in person at your home for the purpose of selling products.

If you do not want to be contacted by door to door salespeople, you can also display a 'do not knock' sticker. These are available free of charge from:

If you do not wish to be contacted by telephone salespeople, you can add your telephone number(s) to the Australian Communications and Media Authority's 'Do not call' register.

If you think a salesperson who has contacted you has not met their legal requirements, try to remember any details provided (e.g. name) and the energy retailer they represent and contact the Australian Competition and Consumer Commission's Infocentre on 1300 302 502.

Further information is available at the Australian Competition and Consumer Commission website.

The National Energy Retail Rules (Rules) also regulate energy marketing activities and are enforced by the Australian Energy Regulator (AER).

The AER has a range of powers to deal with situations in which with retailers (and their marketers) are in breach of the Rules. These powers range from issuing financial penalties to revoking the retailer's legal authorisation to operate as an energy retailer.

Are there any penalties for changing retailers?

If you are currently on a transitional tariff contract or a standing offer contract, there are no penalties for changing to a new contract or a new retailer.

If you are currently on a market contract, there may be a contract exit fee (also known as an early termination fee) if you choose to leave your contract early. You are on a market contract if you have signed up for an electricity contract with a fixed-term period, discount or other incentive.

If you are unsure what type of contract you have, or whether an exit fee would apply to you, you can contact your retailer for help.

Where can I go for help?

If you need help regarding your current electricity contract, such as what type of contract you have or what fees and charges you may owe, you should contract your current retailer.

If you need information about available energy rebates or emergency assistance, please contact your retailer, or visit the NSW energy rebates web page.

If you have a dispute with your retailer, you can contact the NSW Energy and Water Ombudsman (EWON) on 1300 246 545 or at www.ewon.com.au.

For general information about energy in NSW, please phone Service NSW on 13 77 88 or visit www.service.nsw.gov.au.