Origin Energy is refunding $270,000 to over 4,500 electricity customers after allegedly misrepresenting electricity plan prices.
The decision comes after an investigation into its Ongoing Saver plan, led by the Australian Consumer and Competition Commission (ACCC), the country’s leading consumer protection body.
According to the ACCC, Origin falsely represented that its Ongoing Saver plan offered cheaper electricity rates when compared to its Basic plan.
However, some customers on the Ongoing Saver plan were charged more over the life of their plan than they would have been on the Basic offer.
ACCC Commissioner Anna Brakey said, “Electricity retailers that claim or suggest savings for consumers on their plans, including in the name of the plan, must ensure that the savings are actually delivered to customers for the life of the plan.
“Energy plans are complex, and the mix of usage and supply charges makes it difficult for many consumers to assess potential savings. Retailers should provide clear and accurate information about their plans to help consumers make informed decisions.”
Origin Energy disagreed with the ACCC’s findings, but will voluntarily refund affected customers on the Ongoing Saver plan, which has been discontinued.
“We sincerely apologise to customers impacted by this mistake,” an Origin Energy spokesperson told Canstar.
“We have since made improvements and are in the process of refunding these customers an average amount of around $60.”
Why this matters
Government bodies like the ACCC and the Australian Energy Regulator (AER) have been championing a simpler energy market for decades — that includes simpler ways to compare plans.
However, when retailers make misleading claims about guaranteed savings on one plan over the other, it gives customers a false sense of security.
Because the energy market is complex, customers often stick to one plan long-term rather than regularly looking at their bills, their own energy use or other plans and rates.
If customers are signed up for a plan promising savings, this gives them less reason to look at other plans, let alone switch.
Misleading plan names and claims could earn the temporary trust of customers, but it goes against the vision of a simpler and honest market.
Despite changes to industry rules and the efforts of the AER and ACCC, you can't automatically trust a plan to be the best deal.
The devil is in the details
To find the best deal for your situation, here’s what you have to look for:
- Usage rates: A usage rate is the price per kilowatt hour of electricity you consume. This will be the running cost of your electricity. If you use a lot of electricity, a lower usage rate will save you more money.
- Supply rates: The daily amount you pay to remain connected to the grid. If you don’t use a lot of electricity, a lower supply rate will save you more money.
- Discounts: Look out for discounts, which can come in the form of sign-up bonuses for new customers, rewards points and/or dual fuel discounts (if you sign up for electricity and gas from the same provider).
- Benefit period: The duration in which the plan applies. It’s important to know when it expires, in case you’re automatically moved onto your provider’s standing offer, which is typically the most expensive plan they offer. Set a calendar reminder to switch closer to its expiration date.
Each plan’s rates can be found on their Basic Product Information Document (BPID).
If you’ve not compared energy plans in a while, you may unknowingly be on a standing offer. This can easily be verified by looking at your plan’s name on your energy bill.
However, the goal is to start saving money today. If this is all too overwhelming, switching to a cheaper plan could take minutes if you move to your retailer's ‘cheapest offer’, which is listed in your bill’s ‘best offer messaging’ section.
But if you’re willing to compare plans from different retailers, you can use Canstar’s energy hub, which showcases some of the market’s cheapest energy plans from our panel of providers.
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