In terms of services standards and quality, the National Energy Customer Framework (NECF) has a provision to ensure that consumers continue to receive electricity and/or gas supply in the event of retailer failure. Additionally, the NECF has certain specific requirements that are limited to distribution services, and connection and disconnection standards. The Australian Consumer Law (ACL) has a broader scope and provides consumer guarantees for consumer transactions relating to the supply of goods. These consumer guarantees apply to the supply of electricity and gas, unless otherwise specified in the Competition and Consumer Regulations 2010 (Regulations). Figure 1.4 below lists the different consumer protections under both frameworks.
Figure 1.4: Service standards and quality consumer protections
National Energy Customer Framework
The NERL contains a small compensation claims regime to enable small customers to make small claims for compensation from distributors who provide customer connection services to their premises. At present, the scope of this regime is limited to compensation for property damage on a customer's appliances or equipment due to voltage variations. However, no participating jurisdiction has opted-in to the small claims compensations framework to date.
Under the NECF, distributors must also comply with any applicable distributor service standards, including Guarantee Service Level (GSL) schemes. Customers (small customers only in some jurisdictions) who are connected directly to the distributor's network are subject to, by way of local legislation or codes, GSLs covering areas such as reliability customer service and connection and disconnection. Each jurisdiction prescribes GSL schemes, generally for each distribution business. These GSL schemes are determined by jurisdictional regulators and are usually included in a code or license conditions administered by the jurisdictional regulator.
Additionally, distributors and retailers are required to be members of a jurisdictional ombudsman scheme. Energy ombudsmen provide independent dispute resolution services for disputes relating to energy. Small customers can access jurisdictional energy ombudsman to resolve disputes and complaints with their retailer and/or distributor whom are bound by the ombudsman's decision. Customers have the right to refer a complaint against retailers and distributors before the relevant ombudsman and which could be in relation to an energy service, as is explained in more detail in Complaints and Dispute Resolution.
Australian Consumer Law
The ACL provides general protections related to consumer guarantees for the supply of goods and services, and liability of manufacturers for goods with safety defects. Under the ACL, the term 'goods' include, among other things, gas and electricity. The term 'services' include duties, work, facilities, rights or benefits provided in the course of business. Therefore, the ACL has a broad application and will apply to the supply of electricity and gas, unless otherwise specified in the Regulations.
Consumer guarantees
Consumer guarantees provide consumers with a set of rights for the goods and services they acquire. Suppliers and manufacturers automatically provide guarantees about certain goods they sell, hire or lease, and services they provide to consumers. These rights exist regardless of any specific warranty provided by the supplier or manufacturer.
In particular, the ACL states that the consumer guarantees apply to the supply of electricity and gas, unless otherwise specified in the Regulations. These provisions may also apply in relation to the provision of other goods, such as solar panels or batteries. In general, other energy goods and other types of energy related services may be covered by consumer guarantees when they are sold in trade or commerce and bought by an energy consumer.
Consumers are provided with the following guarantees applicable to goods. A supplier and manufacturer will guarantee that:
- the goods are of acceptable quality
- will match any description provided
- and any express warranties must be honoured.
A supplier guarantees that a consumer is buying goods:
- that have clear title, unless otherwise stated
- that do not have undisclosed securities
- that are fit for any disclosed purpose
- with the right to undisturbed possession
- that match the sample or demonstration model provided.
In terms of services, a supplier guarantees that services are provided:
- with due care and skill
- which are fit for any specified purpose
- within a reasonable time (when no time is specified).
Liability of manufacturers for goods
Consumers can also seek compensation for the amount of loss or damages caused by a safety defect in goods supplied by a manufacturer (such as batteries or solar panels). A manufacturer of goods is liable to compensate an individual if they supply a good with a safety defect and the consumer or another individual suffers injures because of the safety defect. The manufacturer is also liable to compensate an individual if they supply a good with a safety defect and:
- other consumer goods are destroyed or damaged by the safety defect
- land, buildings or fixtures are destroyed or damaged by the safety defect.
Energy customers are protected by the specific provisions under the NECF for the supply of energy and by the ACL's consumer guarantees for the supply of energy goods and services.