This submission responds to the Independent Pricing and Regulatory Tribunal’s (IPART) draft report on the Review of the performance and competiveness of the retail electricity market in New South Wales (NSW). IPART’s review found that competition is working well and made two recommendations. These include the winding down of components of state-based green energy and energy efficiency schemes that duplicate federal schemes, as well as the removal of the cap on early termination fees (ETF). In addition, IPART’s overall draft finding is that an in-depth review of retail prices is not necessary as the rise of retail costs are due to wholesale electricity and green schemes.
PIAC believes the strongest indicator of effective competition is whether consumers are paying lower prices and provides benefits to all consumers, including vulnerable and disadvantaged consumers. PIAC believes further analysis on retail competition is required to understand the impact on all consumers.
In response to IPART’s recommendations, PIAC believes careful analysis is needed between the state and federal green energy and energy efficiency schemes, taking into account the overall impact on NSW household consumers. PIAC also believes that if ETFs are to exist, that a cap remains as a form of consumer protection or be banned altogether to reduce consumer barriers to competition. And lastly, PIAC recommends IPART provide an in-depth review of retail prices and profit margins in light of recent research by Carbon and Energy Markets (CME) that shows jurisdictional differences in the amount retailers are charging consumers.