ACCC takes action on Energy Company on misleading power bill
On July 9, 2018, the Australian Competition and Consumer Commission (ACCC) announced that proceedings against Amaysim, Click Energy’s parent company had begun, claiming it was directly in breach of consumer law and misleading marketing claims on electricity discounts.
Energy retailer, Click Energy tried to confuse consumers into accepting “discounts”. They claimed, between October 2017 and March 2018, under its offer to consumers in Victoria and Queensland could get discounts of between 7% and 29% off on their bill for pay on-time payments.
According to ACCC the figures were designed to perplex,customers and were misleading as the discounts applied to Clicks market rate, which was higher than basic offers on the market.
ACCC chairman Rod Sims told Fair fax Media,that while this was not the first time it has taken a retailer to court over poor discounting practices, “this is more serious than most.”The advertised savings were based on the amount a consumer could save with Click Energy by paying on time, and not on an estimate of savings a consumer switching from another retailer would obtain,” We believe that Click Energy’s conduct is among the worst practices we see in retail electricity marketing. Mr. Sims said.
Click Energy also allegedly claimed to customers, if they Switched electricity retailers they could save certain amount which for ACCC was misleading as per no proper basis for representations.
“The retail electricity market is too complex and opaque. Customers need to trust that discounts and savings advertised by retailers are accurate so they can make informed choices about which products are best for them.”
Australian Energy Market Commission announced stronger rules earlier this year to stop the practice of retailers offering “pseudo- discount deals”. These rules are designed specifically to counter retailers inflating the base rate from which they applied a discount, to make discounts appear bigger than they were, which is what Click allegedly have done.
Josh Fryenberg, Federal Environment, and Energy Minister said retailers are being put on notice with these poor discounting practices.
Regulators were disappointed with this incident that keeps on happening provided with a penalty for each breach of the consumer law of around $1.1 million.
Want to know more? Don’t be fooled, be guided by Econnex.