Last year was a mixed bag for competition and consumer law issues in the energy sector. After the high retail electricity prices of 2022 and 2023, 2024 saw a slight fall in retail electricity prices across the east coast of Australia. Notwithstanding the decrease in annual prices for residential offers, the ACCC has indicated that the price drop was not significant enough to offset the large price increases from 2022 to 2023. However, we did see net growth in the number of new electricity retailers entering the market, after consecutive years of decline. Gas prices continued to fall from their high in 2022, supported by lower international gas prices and the increased availability of domestic gas. There was also an improvement in the domestic gas supply outlook throughout the year, with the East Coast expected to have a surplus domestic gas supply in 2025.

Despite some improvements, Australia’s energy market continues to face challenges as it experiences significant change with the increased uptake of renewable generation and the phasing out of coal-fired generation. The electricity sector continues to benefit from the ACCC’s authorisation granted to the Australian Energy Market Operator (AEMO) in 2023 to allow collective conduct in the sector until June 2025. Despite decreases in electricity and gas prices, prices for both remain higher than pre-2022 levels. This reflects the delayed (and ongoing) effects of energy sector market volatility from 2022, which resulted in higher supply costs for electricity retailers and structural issues with gas supply.

Enforcement priorities

In 2024, the ACCC’s enforcement priorities for essential services were consumer and fair trading issues arising from pricing and selling of energy, and competition and pricing issues in gas markets. The ACCC gave effect to these priorities through ongoing monitoring of compliance with the Electricity Retail Code (which regulates electricity retailer conduct to assist consumers in comparing energy plans) and the Gas Market Code (which regulates conduct of gas producers to ensure adequate domestic gas supply at reasonable prices and on reasonable terms).

Electricity

Following on from enforcement action taken by the ACCC in 2023 against retailers CovaU Pty Ltd and ReAmped Energy Pty Ltd for breaches of the Electricity Retail Code, last year, the ACCC issued an infringement notice to Dodo Gas & Power (DoDo) (discussed below) for breach of the Electricity Retail Code. This represents the first enforcement action taken by the ACCC in respect of a retailer’s failure to ensure standing offers comply with the price cap.

Gas

The ACCC has also continued to monitor compliance with the Gas Market Code. Over late 2023 and early 2024, several large gas producers received conditional Ministerial exemptions from the price rules of the Gas Market Code (in return for domestic gas supply commitments in most cases). The ACCC has indicated that this led to an increase in the number of offers made by producers and retailers in the first half of 2024, which together with lower international prices and increased availability of gas, appears to have contributed to lower domestic gas prices. Producers with exemptions from the price rules remain subject to the transparency, conduct, record keeping and reporting requirements of the Gas Market Code, which the ACCC monitors closely.

“While the increase in contracting activity is a positive sign, more time is needed before we can see what impact the Gas Market Code is having on the operation of the gas market, including how suppliers are making their gas available to the market as well as engaging with gas buyers.” ACCC Commissioner, Anna Brakey said.

Major developments and activities

Dodo Power & Gas

Enforcement of the Electricity Retail Code

In June 2024, M2 Energy Pty Ltd, trading as Dodo Power & Gas (Dodo) paid $82,500 in penalties after the ACCC issued six infringement notices to Dodo for alleged contraventions of the Electricity Retail Code. The alleged breaches included:

• standing offer prices being above the relevant price cap between 1 July 2022 – 31 May 2023; and
• issuing price change communications that failed to include required information and maintain adequate records.

Along with paying the penalty, Dodo has committed to cease the relevant conduct and implement a compliance program to prevent future breaches.

Viva Energy’s acquisition of LOC Global

Notable M&A activity

In December 2024, the ACCC agreed not to oppose Viva Energy’s proposed acquisition of a 50 per cent interest in LOC Global (LOC) from New World Corporation (NWC). LOC is a joint venture between Viva Energy and NWC that operates over 100 retail fuel and convenience sites across all states and territories in mainland Australia (excluding Tasmania and the ACT). As such, on completion of the transaction, Viva Energy will hold a 100% interest in LOC. In deciding not to oppose the acquisition, the ACCC accepted a court-enforceable undertaking from Viva Energy. That undertaking requires Viva Energy to divest 14 LOC retail fuel and convenience sites to Solo Oil Corporation, a new wholly owned subsidiary of NWC. The main focus of the ACCC’s assessment was Viva Energy and LOC’s overlap in retail fuel supply across Australia.

ACCC Commissioner, Dr Philip Williams, indicated that:

“Without the divestiture, the ACCC was concerned the proposed acquisition could increase prices and reduce service offering, particularly in Adelaide and in certain local areas in Darwin, regional Queensland, and regional Victoria.”