Origin to pay refunds over misleading power plans

Refunds have been promised to more than 4500 Origin Energy customers following a consumer watchdog probe into misleading power plans.

The offer in question misleadingly implied ongoing savings despite some customers paying more than the basic plan, the Australian Competition and Consumer Commission alleges.

Credits or refunds of roughly $60 will be available and the offending “Ongoing Saver” plan nixed.

The energy retailer has not admitted to breaking consumer law but rather responded by committing to compensation and apologising to impacted customers.

No further enforcement action will be taken. 

Despite multiple attempts at reform, confusing energy bills remain a stubborn problem that consumer groups say disadvantages customers and leaves many disengaged.

Disengaged customers tend to stay on the same plan rather than shopping around, leaving them paying the “loyalty penalty” once enticing introductory deals lapse.

ACCC commissioner Anna Brakey said energy plans were complex and the mix of usage and supply charges made it difficult to assess potential savings.

“Retailers should provide clear and accurate information about their plans to help consumers make informed decisions,” she said.

The investigation was spurred by a complaint from CHOICE about the retailer’s “Ongoing Saver” plan.

The consumer advocates say the use of the phrase “saver” and description of an “ongoing lower rate that you don’t need to renew” may have led consumers to believe they were on a better deal, so there would be no need to switch.

”The plans degraded in value for customers over time – yet another example of the energy ‘loyalty penalty’, which was at the core of our complaint,” CHOICE director of campaigns and communications Andy Kelly said.

“The unfairness of the loyalty penalty rife in the energy market cannot be ignored.”

An Origin spokesperson apologised to customers impacted by the mistake. 

“Around 4500 customers, or 0.5 per cent of customers on the plan, paid an average total of $28 more than they should have,” the spokesperson said. 

“We have since made improvements and are in the process of refunding these customers an average amount of around $60.”

Origin will contact customers to arrange a credit or refund.

The ACCC urged customers to be alert to scammers claiming to be from the retailer and stressed Origin would not ask for credit card or banking details.