- Energy retailers will be subject to the ban
- $1M fine will apply to energy retailers who wrongfully disconnect vulnerable users
- 'Save' and 'win-back' promotional offers will be banned
The Victorian Government has today announced it will phase in a ban on energy retailers who engage in door-to-door sales of their products. Additionally, a penalty of up to $1 million will apply to energy retailers who wrongfully disconnect vulnerable users.
Lily D’Ambrosio, Minister for Energy, Environment and Climate Change, said the Energy Fairness Bill will protect households and businesses from aggressive and exploitative tactics employed by energy retailers.
“We are banning high-pressure sales tactics like unsolicited door-to-door sales and cold-calling to protect Victorian households from being taken advantage of by dodgy energy companies.”
“We’re putting energy companies on notice – if you have wrongfully disconnected households you will pay a penalty of up to $1 million.”
Lily D’Ambrosio, Minister for Energy, Environment and Climate Change
The announcement comes as earlier this month a solar energy equipment supplier was fined $3 million for applying aggressive and misleading sales tactics.
The $1 million penalty for cutting off vulnerable users is particularly designed to protect consumers who are on payment plans or need electricity for life support.
Gas and electricity licensees who submit false or misleading information to the Essential Services Commission are also subject to a $1 million fine.
As of 31 December 2021, electricity and gas retailers using what is described as ‘high-pressure sales tactics’ for retail contracts – including door-to-door sales or cold-calling – will be banned.
For solar businesses under the Solar Homes Program, door-to-door sales will be banned even earlier, on 1 September 2021.
Additionally, ‘save’ and ‘win-back’ promotional offers will be banned. This tactic often involves providing a consumer short-term discounts that may end up resulting in the cost running higher in the long run. By doing this, retailers stifle competition. The Victorian Government hopes by banning this practice, customers will be able to find the best price in the market in a transparent manner.
In a statement, the Victorian Government said the Bill will result in a fairer energy retail market. It added that since the last election, retail electricity prices have fallen by 10% and the number of disconnections had halved.
