Carbon tax savings must benefit consumers
Ever since the carbon tax was repealed, pressure has been mounting on electricity on-sellers to make sure consumers are benefiting from their reduced costs.
The government decided to scrap the carbon tax on July 17 in a bid to reduce the burden on Australian households and businesses. However, this will only be the case if savings are being passed on to customers.
As a result, the Australian Competition and Consumer Commission (ACCC) is now carrying out an investigation to make sure energy suppliers are playing their part. Concerns have been raised that electricity on-sellers aren't reflecting their cost savings in customers' bills.
"Our initial focus was on electricity retailers," said ACCC Chairman Rod Sims.
"Now that these retailers are passing on cost savings to their customers, it is timely to ensure that electricity on-sellers do the same, and pass on those cost savings to their own customers."
On-sellers are responsible for buying electricity from retailers before selling it on to customers through a site they either own or operate. Situations where this might arise include residential apartment blocks and shopping centres.
Under the Competition and Consumer Act 2010, any electricity supplier is required to pass on savings that can be attributed to the repeal of the carbon tax. This means on-sellers must pass on all reductions they have received, including refunds from the original supplier.
Figures from the government predict that removing the carbon tax will lead to a $550 reduction in living costs in 2014-15. The cost of retail electricity is forecast to decline 9 per cent, while gas prices will end up being around 7 per cent lower.
It is estimated that the carbon tax would have added around $25.40 to the average energy bill, putting extra pressure on some households that were already struggling with rising prices.
Posted by Nikki Wilson-Everett