M2 Energy Pty Ltd, trading as Dodo Power & Gas (Dodo), has paid six infringement notices totalling $406,800 issued by the Australian Energy Regulator (AER) for alleged breaches of the National Energy Retail Rules (the Retail Rules) that protect consumers experiencing hardship and payment difficulties.
The AER took enforcement action against Dodo following a proactive compliance review of energy retailers. The findings of the AER’s review prompted an investigation into Dodo’s hardship and payment plan practices. The investigation also identified concerns about Dodo’s compliance systems and processes for its hardship, payment plan and direct debit practices.
Following the investigation, the AER alleged Dodo did not inform three hardship customers of its hardship policy as required by rule 71(1) of the Retail Rules. As a result, the customers may not have been aware of supports and protections available to them.
The AER also alleged that Dodo did not consider three consumers’ capacity to pay when establishing payment plans as required by rule 72(1)(a) of the Retail Rules.
“It is essential that retailers have the right compliance systems and processes in place to ensure consumers experiencing vulnerability receive the important hardship protections they are entitled to under the Retail Rules,” said AER Deputy Chair Justin Oliver.
“With ongoing cost-of-living pressures impacting many households, the AER remains firmly focussed on protecting consumers. This includes proactively monitoring retailers and taking action where necessary to ensure energy consumers are fully afforded their rights under the relevant rules and laws.”
In addition to the six infringement notices, the AER has accepted a court enforceable undertaking from Dodo, where Dodo admits it breached rules 71(1) and 72(1)(a) of the Retail Rules and acknowledges the AER’s concerns in relation to Dodo’s compliance systems and processes relating to its hardship, payment plan and direct debit practices.
The enforceable undertaking includes requirements for Dodo to:
- appoint an independent expert to conduct a review of its hardship policy and compliance with hardship and direct debit obligations
- establish and maintain a compliance and training program on hardship and direct debit obligations
- refund direct debit fees applied to hardship customers impacted by any unauthorised direct debit attempts between 8 October 2022 and 8 October 2024, and
- refrain from charging hardship customers direct debit decline fees for a period of two years commencing within six months of the enforceable undertaking.
ENDS
Notes to editors
The AER’s power to issue infringement notices
The AER can issue infringement notices when it believes on reasonable grounds that a person or business has contravened certain provisions of the Retail Rules.
The person or business can choose to comply with the infringement notice by paying the penalty specified in the notice. Alternatively, they are entitled to disregard the infringement notice and to defend any legal proceedings that are subsequently commenced by the AER in respect of the alleged breach.
The payment of an infringement notice does not constitute an admission of liability by the person or business.
Court enforceable undertakings
The AER can accept a court enforceable undertaking from a regulated business in relation to any of our areas of responsibility under the national energy laws.
An enforceable undertaking might include commitments to undertake an audit or appoint an independent expert to ensure that the business has identified the root cause of the breach and the risk of future breaches is mitigated, or could contain commitments that relate to consumer redress (for example, debt waivers).
Compliance and enforcement priorities
Improving outcomes for customers experiencing vulnerability, including by improving retailer hardship policies and access to hardship and payment plan protections is one of the AER’s Compliance and Enforcement Priorities for 2024-25.
Protecting vulnerable consumers, while enabling consumers to participate in energy markets, is also one of the AER’s three enduring Compliance and Enforcement Priorities.
Learn more about the AER’s enduring and 2024-25 Compliance and Enforcement Priorities here.