BRANCHES OF THE BIG STICK
Laws will be introduced to federal parliament this week bringing in penalties and remedies for electricity companies that engage in misconduct.
WHAT THE NEW LAWS DO?
* Retailers which fail to reasonably pass through sustained and substantial electricity supply chain cost savings to consumers will be committing misconduct.
* Energy companies withholding hedge contracts for the purpose of substantially lessening competition will be committing misconduct.
* Generators manipulating the spot market, such as withholding supply, will be committing misconduct.
* The ACCC will issue warning notices and infringement notices.
* Court-ordered civil penalties are available, up to the greatest of: $10 million; three times the value of the total benefit attributable to the conduct or 10 per cent of the annual turnover of the corporation in the 12 months before the conduct occurred.
* On the recommendation of the ACCC, the Treasurer could require electricity companies to offer electricity financial contracts to third parties.
* On the recommendation of the ACCC, and following an application by the Treasurer, the Federal Court can issue divestiture orders relating to misconduct in the wholesale market.
* Divestment orders will only be available where the corporation's conduct is fraudulent, dishonest or in bad faith and there is a "net public benefit".
* Government-owned enterprises will be subject to the new laws.
* Review of the laws in 2024 and they will sunset in 2025.
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