Australian energy businesses paid $4.76 million in penalties in 2020‑21 for alleged breaches of National Energy Laws, according to the latest compliance and enforcement annual report by the Australian Energy Regulator (AER) released today.
The report highlights the AER’s work in protecting energy consumers in the National Energy Market through successful court action and infringement notices.
Energy businesses paid almost $1 million in infringement notice penalties for issues such as wrongful disconnection, failure to provide life support protections to vulnerable customers, and failure to meet timeframes for installing and repairing meters used to calculate customers’ energy bills.
Successful AER litigation also resulted in $3.8 million in civil penalties being paid for issues related to customer hardship, retail performance reporting, and the outcomes of the AER’s investigation into South Australia’s state-wide blackout in 2016.
Throughout the year, the AER also secured two court-enforceable undertakings from retailers to correct failings in compliance processes and systems, and completed five audits of retail businesses, focusing on their compliance with financial hardship policies and the requirement to provide timely and accurate retailer performance data.
More details on all compliance and enforcement activity are outlined in the report.
On 23 June 2021, the AER announced its compliance and enforcement priorities for 2021-22, which together with the updated Compliance and Enforcement Policy, also released today, will guide the AER’s enforcement work and proactive compliance efforts in the coming year.
The updated policy includes the AER’s increased investigative powers and penalties introduced in January 2021. The maximum penalties for certain provisions is now the greater of $10 million, three times the benefit obtained from the breach, or 10% of annual turnover.
Background
The AER Compliance and Enforcement Policy sets out how we approach our roles and functions in monitoring, investigating and enforcing compliance with national energy laws.
The Policy should be read in conjunction with the Compliance and Enforcement Priorities published on our website, which help guide our enforcement work and proactive compliance efforts, and also signal areas where we consider behavioural change in the market is required.
Our priorities align with the objectives in the AER's Strategic Plan 2020-25, and are informed by consultation with our stakeholders and the risk based decision making framework set out in this Policy.
In addition to our work in priority areas, we will also act where there are serious issues impacting vulnerable consumers, or to help shape new or emerging markets. We will assess matters, having regard to the compliance and enforcement factors in the Policy, and take action as necessary.