11/09/2018 | News release | Distributed by Public on 11/08/2018 07:26
The AER today commenced consultation on the development of default market offer prices to help ensure fairer electricity prices for many household and business consumers.
The introduction of a default market offer was one of the key recommendations of the ACCC's Retail Electricity Pricing Inquiry(REPI) report(link is external).
AER Chair Paula Conboy said that the position paper released today is an important first step in gaining input from stakeholders as part the AER's process for developing default market offer prices.
'In setting default market offer prices, our aim will be to provide fairer prices for standing offer customers, while ensuring we continue to promote competition and innovation in the retail markets. An important part of our process will be listening to the views of stakeholders through an open and consultative process,' Ms Conboy said.
'Standing offer prices are generally applied to inactive consumers who don't, or can't, shop around. They are set by electricity retailers and, as pointed out in the report, are unjustifiably too high.
'Default market offer prices will replace standing offer prices to ensure consumers who are currently on standing offer contracts will have access to fairer prices.
'Default market offer prices will also be an input into the development of reference bills that will be used by retailers to calculate and advertise their discounts. This will make it much easier for consumers to compare offers between retailers and find better deals.'
Stakeholders are invited to submit written responses on the issues and questions identified in the position paper by 7 December 2018.