Malcolm Turnbull has summoned the heads of Energy Retailers to provide more information to consumers. This change is aimed at helping the community make better energy decisions…but in my opinion, it is not going to deliver any meaningful results. Why? Because if we are serious about helping consumers ensure they are on the best plan and are making informed decisions on how they consume energy, we must give them, and approved third parties, easy and timely access to their energy. Telling the retailer to give customers more information will only cause more marketing. However, if the energy data is made available to third parties such as price comparison sites, it will generate innovation, take advantage of the open market structure, and ensure retailers put their best foot forward. This also creates much needed trust and transparency in the market.
The Government can take the lead to introduce three simple steps that will produce a consumer who can make an informed choice as to which energy plan is best for them.
Step One – Mandate that consumers can approve third party access to their consumption data and make it a simple process. The data needs to be provided at the same frequency to which it is collected, so if it is collected every day, then it should be available to others every day.
(I’d suggest Australia partner with the Green Button Alliance. This partnership will immediately give consumers access to the numerous energy saving services available to US energy consumers. This partnership will also create enormous opportunities for Australian start-ups as the services they bring to market here will be easily transferable to the US market.)
Step Two – Mandate that all retailers must expose the details of their product offers in a, to be defined, standard format that includes all that small stuff consumers don’t read or understand but are the real guts of the plan, such as discount periods. The standard format will mean third party applications can analyse the energy data against these offerings and provide meaningful guidance to the consumer.
Step Three. Raise awareness in the community and encourage them to use comparison sites to access their consumption data and explore third party services to help them optimize their energy use. Think of the successful role the Government has played in the past, for example encouraging people to save water. Like this, the Government need to take the lead in mobilizing the community to make the necessary shift in behaviour, not the Energy Retailers who have a vested interest in the outcome.
The amount and frequency of energy data collected for any single customer depends on the electricity meter they have installed. While these steps would apply to the entire market, those consumers on smart meters would enjoy a more accurate assessment of the best energy plan for them. Once again, Victoria is in an enviable position and should take a lead role here to demonstrate that their decision to mandate the roll out of smart meters to all consumers was the right one.
If we are serious about creating an informed consumer, why aren’t we implementing these three simple steps?
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