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Energy company accused of misleading discount claims

Energy company accused of misleading discount claims

Thousands of energy customers are set to be compensated after a major utility company was accused by the ACCC of making misleading price comparisons of its advertised discounts.

Thousands of energy customers are set to be compensated after a major utility company was accused by the ACCC of making misleading price comparisons of its advertised discounts.

The ACCC raised concerns about price comparisons and discounted energy tariffs made by Alinta Energy in advertisements between 9 December 2017 and 28 February 2018.

Those concerns centred around the perception that Alinta was discounting rates by 2.8 per cent, when the actual discount was only 1.8 per cent.

“Alinta’s conduct prevented customers from making informed choices about which electricity retailer best suited their needs,” the ACCC’s acting chair Delia Rickard said.

“Businesses must not mislead consumers in advertisements comparing their prices or services to those offered by competitors.”

After the ACCC raised concerns that the claims were likely to have breached Australian Consumer Law, Alinta committed to contact all affected customers in Victoria and honour the advertised discount, which will be provided as credits against future bills.

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Alinta also ceased the advertising campaign and has undertaken an internal review of advertising processes.

In a statement responding to the ACCC’s announcement, Alinta said it has “worked quickly and proactively” with the ACCC to resolve the concerns raised.

“The error occurred when an average tariff reduction figure was reviewed and found to be one per cent lower than the 2.8 per cent average reduction that was communicated during this period. Alinta Energy proactively raised this with the ACCC and will contact affected customers and apply a credit on their next bill after 12 July 2018,” it said.

“Alinta Energy has also further volunteered to reduce its July 2018 standing tariffs to move all Victorian customers to a minimum 2.8 per cent reduction on its July 2017 standing tariffs. The previous Victorian tariff change in July 2017 reduced tariffs on average, but not as a minimum for every customer. This further voluntary measure is aligned with the company’s commitment to make energy more affordable for its customers.”

The groups’ executive director of retail markets, Jim Galvin, apologised to affected customers.

“We remain absolutely committed to making energy more affordable for you, and recognise our communication should have been clearer and error-free,” Mr Galvin said.

 

Energy company accused of misleading discount claims
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