The Australian Energy Market Commission (AEMC) has made a final rule that makes it simpler for households and small businesses to save money on their energy bills.
It requires retailers to alert each customer of opportunities to save through switching to another plan in communications that accompany a bill.
The “better offer” message currently sits inside a customer’s energy bill. However, research shows nearly half of customers don’t always open their bill, meaning they are missing important details about how they can save.
AEMC Chair Anna Collyer said evidence shows that improved visibility of what’s on offer increases engagement.
“Energy bills can be complex, and many customers are busy, leading large numbers to disengage and potentially miss out on better plans,” Ms Collyer said.
“This final rule is like placing important price information on the shopfront, making it clear, upfront and hard to miss.
“More informed customers make better financial plans, which in turn improves competition in the energy retail market.”
The initial rule change request proposed improvements to the process to switch energy plans.
The AEMC made a more preferable final rule after drawing on insights from the Behavioural Economics Team of the Australian Government (BETA) and the Australian Energy Regulator to promote behavioural change.
Their research, along with stakeholder feedback, suggest that a more visible “better offer” message will encourage more customers to switch. Once a customer has decided on switching, the process is usually quick and straightforward.
Findings from the ACCC also show that customers who don’t regularly engage in the retail energy market often pay the highest prices, particularly those on legacy plans with large conditional discounts or expired benefit periods.
This work forms part of a package of seven rule changes submitted by Energy Ministers that aims to strengthen consumer protections and provide them with more opportunities to save money.
The measures to help customers switch to a better offer complement the recently completed Improving consumer confidence in retail energy plans rule change, which prevents retailers from increasing retail contracts more than once a year.
The AEMC is also undertaking a forward-looking electricity pricing review that includes examining broader reforms to help consumers engage more effectively in the retail market.
The final rule will come into effect on 30 December 2026. In the meantime, the AEMC encourages consumers to take a few minutes to check their energy bills to look for the better offer message, which could save them hundreds of dollars a year.
Visit the project page for more information and contact details.
Media: Jessica Rich, 0459 918 964, media@aemc.gov.au