Generic image of an Ergon Energy bill.
Generic image of an Ergon Energy bill. Contributed

Ergon accused of overcharging 1100 large regional businesses

THE company responsible for providing power to regional Queensland is in hot water after being accused of overcharging Central Queensland's large business customers.

In regional Queensland, the Queensland Competition Authority (QCA) is the price regulator with the power to set notified power prices for Ergon Retail.

In bombshell revelation, the QCA said they had launched an investigation into Ergon Retail for breaching the National Energy Retail Law Queensland Act 2014 (NERLQ Act) by overcharging the large regional business customers.

QCA Chair Professor Roy Green said that under the act Ergon Retail was legally required to charge its large customers the regional retail notified electricity prices set by the QCA each year.

QCA Chair Professor Roy Green called on Ergon Energy to cease charging the wrong amount to large regional business customers immediately.
QCA Chair Professor Roy Green called on Ergon Energy to cease charging the wrong amount to large regional business customers immediately. Contributed

"However, Ergon Retail has been charging large regional businesses for metering costs, in addition to notified prices, since 1 January 2017,” Professor Green revealed.

Professor Green said the QCA had called on Ergon Retail to cease charging these amounts immediately and had commenced a full investigation to determine the full extent of the breach.

"Preliminary information from Ergon Retail indicates that about 1100 large regional businesses have been overcharged a total of more than $760,000 for metering services, with some customers potentially overcharged thousands of dollars,” he said.

"The QCA's investigation will confirm precisely how many customers have been affected and to what extent.

"This is a significant matter that requires a full investigation, and today we have taken action to ensure customers pay Ergon Retail only what the law requires.”

Ergon Energy will have their work cut out trying to deal with this problem of overcharging regional businesses.
Ergon Energy will have their work cut out trying to deal with this problem of overcharging regional businesses. Chris Ison ROK250215cpower9

Once they had completed the investigation and have all the facts, Professor Green said the QCA will determine what enforcement action should be taken against Ergon Retail.

"Our primary concern is for customers. We will do everything in our power to ensure they are fully refunded for any illegal charges and will not hesitate to protect customers by acting on any further breaches uncovered by the investigation,” he said.

Based on current evidence, he said the breach affected large regional businesses that used more than 750 megawatt hours of electricity per year.

QCA's role is to set regulated retail electricity prices for regional Queensland based on network, wholesale energy and retail costs.

The QCA hosted a meeting Keppel and Rockhampton energy consumers in April consulting with residents during their process of deciding the price of power with a workshop set to be held in Rockhampton next month before submissions close on April 9.

READ: CQ locals needed for electricity bill workshop

The cost of power is a sore point in CQ with numerous politicians visiting large energy consuming businesses like Dobinsons Springs and Suspension promising various solutions to the problem over the years.

READ: LNP: Business with solar still hurt by high power bills

READ: One Nation: Hanson says expensive power is hurting CQ manufacturers

READ: Labor: Labor's plan to knock money off CQ business's power bills

Labor politicians Rockhampton MP Barry O'Rourke, Keppel MP Brittany Lauga, and former Energy Minister Mark Bailey meet with Dobinson's Spring and Suspension manager Chris Dobinson to discuss power prices.
Labor politicians Rockhampton MP Barry O'Rourke, Keppel MP Brittany Lauga, and former Energy Minister Mark Bailey meet with Dobinson's Spring and Suspension manager Chris Dobinson to discuss power prices. Allan Reinikka ROK311017adobinso

READ: Labor defends its approach to lowering CQ's power prices

The Morning Bulletin has approached the Queensland Government for comment.

Ergon Energy Retail provided a statement on the issue raised by the QCA of overcharging their large retail customers:

The Queensland Competition Authority (QCA) has advised Ergon Energy Retail that it believes there has been a contravention of the National Electricity Rules by charging large customers for unregulated metering services. The QCA has sought further information from Ergon Energy Retail on this issue on what is essentially a difference in interpretation of regulations.

This issue relates to very large customers for unregulated metering services. This does not relate to mum and dad residential customers or small businesses who are already charged for regulated metering services permitted by the QCA regulated prices.

Ergon Energy Retail incurs costs as a result of servicing large customer metering points. These customers represent around 0.1 % of the customer base and a number have requested these meters to meet their business requirements. Many of these customers are large government energy users. The balance are customers such as large mines and major industrial and commercial sites.

Before these charges were implemented, and we believe they have been originally levied appropriately, these costs were borne by all taxpayers. These metering charges are on average $2 per day and represent less than 1.5% of the bill for these customers. Impacted customers were notified of these charges before charging commenced.

Further, The QCA in its draft determination for regional Queensland electricity prices for 2017/18 have proposed themselves the charging of these customers for metering services, based on a true cost evidenced by the QCA by inclusion in the their draft.

Ergon Energy Retail has been speaking to officers of the QCA to attempt to resolve the issue. Ergon Energy Retail will fully cooperate with the QCA as part of its investigation to resolve the issue as we believe charges have been levied appropriately.

Ergon Energy will stop charging for unregulated metering services to large retail customers until this issue is resolved, noting that these same customers will again be charged from 1 July 2018 as per the QCA draft determination.

Any large business customers in regional Queensland with concerns about their bills should contact the QCA via their dedicated webpage or Ergon Retail on 1300 135 210.



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