5 December 2018

Statement on Prohibiting Energy Market Misconduct Bill

Origin notes the introduction of the Commonwealth Government’s Treasury Laws Amendment (Prohibiting Energy Market Misconduct) Bill 2018 into the Parliament today.

While there have been substantial changes to the draft, this Bill remains poor policy that is not guaranteed to bring prices down for customers.

Origin CEO Frank Calabria said, “We are completely aligned with the objective of making energy more affordable and support strong consumer protections, however this is not the way to achieve these outcomes.

“This Bill discriminates against companies like Origin by removing incentives to invest in generation as we will be prohibited from earning a return on that investment, despite wearing the risk.

“We struggle to see how this legislation will reduce prices, with the more likely consequence that it increases risk, and therefore cost, for energy companies investing right at the time the market needs new supply to bring prices down for customers.

“The Bill remains a significant over-reach, giving the ACCC and the Treasurer greater powers to interfere in companies – based on their belief, without merits review and under the threat of adverse action.

“Given the quantum and nature of amendments from last week’s draft, which Origin notes has been withheld from the public, we are concerned at how hurried and intemperate this legislation is.

“We will now take the time to review the legislation and supporting materials in detail to understand its full impacts on our business and customers.

“Rather than rushing to legislate, we call on government to work with industry to develop a coordinated energy and climate policy to encourage much needed investment to drive the transition to clean energy at least cost to the community.

“The truth is that coordinated policy action across the supply chain, as the ACCC made clear in its 56 recommendations, is the key to delivering a material, sustainable reduction in prices for customers,” Mr Calabria said.