The Australian Competition and Consumer Commission (ACCC) has launched a Carbon Price Claims Hotline in an effort to make it easier for consumers to lodge a complaint with regards to carbon price claims.
Since the commencement of the carbon pricing mechanism (CPM) on 1 July 2012, the ACCC has received over 630 complaints and enquiries from consumers regarding businesses making claims of price increases due to the carbon price. ACCC’s statistics to date indicate that a large number of complaints are related to energy retailers’ making claims of price increases to consumer energy bills.
Other sectors that have been subject to complaints and enquiries are:
- landfill,
- building and construction, and
- refrigerant gases.
The ACCC advises that there may be some confusion arising from reports about the variety of cost pressures that impact on businesses and why prices may rise. For example, a price may increase partly due to the carbon price and partly due to other unrelated factors. What might appear to be a carbon price representation at first glance, may turn out to be something different.
The ACCC advises consumers to shop around, think twice and ask questions about these claims.
Businesses have rights when dealing with their suppliers and the same rules, to not mislead in relation to the carbon price, apply to suppliers. The ACCC
has published a series of Business Snapshots – available at www.accc.gov.au/carbon – including one on dealing with suppliers.
Rod Sims, ACCC Chairman said “on the whole, the ACCC has not identified widespread issues and where there have been concerns the ACCC has worked with businesses to address them promptly.
Overall, the number of complaints we have received about small businesses and small retailers has generally been low. However, when any business attributes a price increase to the carbon price, they must not mislead consumers.”
“Claims must be truthful and have a reasonable basis.”
“A business that makes a good faith, reasonable approach to calculating the carbon price for their business has nothing to fear from the ACCC”, Mr Sims said.
Re – Cost pass through:
ACCC has provided the following summary of complaints received regarding cost pass through:
- “Landfill: Complaints have been received in relation to price increases.
The ACCC notes that calculating pass through costs associated with the CPM in relation to landfill is a very complex issue faced by local councils and landfill operators. These calculations are affected by factors, such as size of the operation, use of abatement mechanisms, any discount rates that may apply and the price of emissions in the future. Calculations are further complicated by the forty year decay period on landfill during which the operator is liable for
emissions produced. As with energy retailers, the ACCC has been in contact with a number of local councils and industry associations to understand their approach.”
- “Building and Construction: Complaints have been received in relation to price increases.
The price of materials used in the construction of residential and commercial dwellings varies from year to year with or without a carbon price, therefore isolating the effect of the carbon price may be difficult. The building and construction industry will face the CPM through the use of a number of materials that have a high carbon intensity (e.g. steel, glass and concrete) however the industry will also be compensated in some areas. The ACCC has and continues to have discussions with industry associations and particular building businesses about the claims they may have made.”
- “Refrigerant gases: Complaints have been received in relation to price increases.
The price of Synthetic Greenhouse Gases, or refrigerant gases, increased significantly from 1 July, as an equivalent carbon price applies to SGGs listed under the Kyoto Protocol. There are also indicators that price increases may be due to reductions in supply, increases in raw material costs, growing demand for refrigerant gases in emerging economies and some refrigerants having been targeted for usage reductions. The ACCC is considering the issues and will watch closely for price increase representations that attribute the entire increase to the carbon price.”
ACCC’s Carbon claims Hotline
t. 1300 303 609.
AEBN comment
The Australian Environment Business Network (AEBN) will be holding the forthcoming Australia’s Carbon Price Update Seminar on 28 August 2012 in Melbourne to assist businesses to understand and meet their statutory obligations under the Clean Energy Act and National Greenhouse and Energy Reporting (NGER) Act.
The Seminar will provide an regulatory and legal perspective on carbon claims, cost pass through, contracts, dealing with suppliers, customers and much more. The Seminar will also include the tools for ‘developing and implementing a carbon strategy for your business’.
A detailed program and on-line registration is now available.
Please register early as places are limited.
