Energy competition
In addition to the information below, we have online factsheets and an article on marketing.
Choosing a contract
Since 2002, many electricity and gas customers in NSW have been able to choose where they buy their energy. A range of suppliers offer negotiated contracts to customers with different prices (tariffs), fees, benefits and conditions. If you choose to shop around, you might find a deal that is more attractive. By entering into a contract, you are only changing retailers. The network (the poles, wires, pipes, substations) is still owned by the network operator.
Shopping around
Each energy retailer operating in New South Wales offers contracts with different prices (tariffs), fees, payment options, and other services.
EWON suggests that you take your time and gather as much information as you can on the range of different contracts on offer. A number of different companies offer electricity and gas contracts, and some suppliers offer both.
Please see our electricity and gas supplier pages for the contact details of all the energy suppliers offering contracts to households and small businesses in NSW. You can ask these companies to send you a contract offer without any obligation on your part.
Check the contract
Once you receive your contract, read it carefully and compare it to the information from other suppliers. If in doubt about anything on the contract - ask the company or get independent advice.
To make an informed decision, you should consider:
- how long the contract lasts
- if there are any termination fees for ending the contract early
- whether you will be charged a termination fee if you move
- what the tariffs are and if they can increase
- details of late payment fees or other charges
- how often you receive a bill and the options for paying it
- if there any charges for paying a certain way
- whether you will have to pay a security deposit
- if you can use green energy
- if you can still use your off-peak hot water
Before you sign
Energy contracts are legally enforceable; make sure you understand the terms and conditions. If you don't understand something, ask your energy supplier or get independent advice on what it means.
If someone offers you something verbally, make sure the offer is written into the contract.
Always keep a copy of the contract you have signed. You may receive a lot of paperwork with the contract. You should keep it all in a safe place.
Be aware that fees may be imposed if you move or end your contract early.
Important tips
All contracts have a 10 day cooling off period, which means if you change your mind you can cancel the contract within 10 days and not have to pay any cancellation fees. Most contracts can only be cancelled in writing.
If you currently receive a life support rebate or a pensioner rebate on your electricity account, you should make sure that your new retailer has these details.
Your contract will usually start after your next meter read. You should receive a final bill from your old retailer and a welcome letter from your new retailer to let you know your new contract has begun.
Energy marketing
You may be approached in person, by mail or by phone to enter into an energy contract. You can contact EWON for help with a complaint about any electricity or gas marketer in New South Wales, including door-to-door salespeople and telemarketers.
Marketing Code of Conduct
The Marketing Code of Conduct regulates all marketing of energy contracts. You can contact us if you have a complaint about a marketer that you have not been able to resolve. Generally, we would expect you to have tried to sort out your complaint with the supplier first. Before contacting your supplier, have a look at some of our tips for dealing with your supplier. See also your rights and obligations.
You don't have to agree
If an energy marketer approaches you with a contract, take the time you need before agreeing to sign anything. You may find a better deal from another electricity or gas supplier, so shop around. See choosing an energy contract for further advice, and information on what to look out for when comparing contracts.
Energy contracts are legally enforceable; make sure you understand the terms and conditions. If you don't understand something, ask your energy supplier or get independent advice on what it means.
What to look out for
If a marketer makes a verbal offer to you, make sure the offer is written into the contract. The law says that only things written in the contract terms and conditions form part of the contract.
Door-to-door salespeople may come to your home or business with a contract ready to sign. If the contract is signed by someone other than the account holder, for example your spouse, flat mate or an employee, the supplier may still take this as binding. Contact us for more information.
If you have received an offer in the mail and have called the company to accept the contract, this may still be a binding contract, even if you did not sign anything. Check with your electricity or gas supplier if you are concerned about this or contact us.
Consumer protection
If you do decide to sign, remember any contract you enter into has a 10 day cooling off period. During this time you can cancel the contract and stay with your current provider. You will not need to pay any cancellation fees if you cancel in writing.
There are other protection mechanisms to ensure you are not pressured into changing energy providers. If you have any questions about the marketing practices of a door-to-door salesperson, you should contact the supplier to report the matter. If you are not satisfied with their response, you can contact us.
Issues raised by customers
You can contact EWON for help with an energy competition-related complaint. Since competition commenced, we have helped resolve a range of different complaints, but most have been in the following areas:
Marketing practices
A number of energy suppliers have been marketing energy contracts door-to-door. EWON has received complaints from customers about the way salespersons have behaved, or the information that salespersons have given them about contracts.
Common complaints we have received include:
- a belief by customers that the salesperson was from their existing supplier, when they were not.
- misunderstanding the nature of the documents customers were signing; some customers did not understand that they were signing a binding, two or three year contract.
- customers signing a contract because they believed it would provide benefits that were not really available.
- customers who had difficulty understanding the contract due to language difficulties, a disability, or age.
Termination Fees
Many suppliers charge early termination fees if a customer terminates the contract before the end date. The amount of the fee and the circumstances in which it will be charged depend on the contract.
Common customer complaints have included:
- being unaware of the fee, or the amount of the fee.
- feeling the amount of the fee is unreasonable.
- being unable to contact the company to cancel the contract during the cooling off period and then having a fee applied when they did terminate their contract.
- being unable to take their contract with them to a new property when moving, thus forcing them to cancel their contract and being charged a termination fee.
- being charged a termination fee when ending a contract due to unsatisfactory customer service or misleading information from a salesperson.
Transfer difficulties
If you are signing a contract with new supplier, the account will need to be transferred. Some customers have experienced delays with the transfer process, or have found their account accidentally transferred to another supplier altogether.
Common problems have included:
- double billing, where the customer has received a bill from both the old and new supplier.
- delays in billing, often followed by a large catch-up bill.
- problems with payment plans, with Centrepay, direct debit, or smoothpay payments being sent to the wrong supplier.
- customers unable to find out who their supplier is after being transferred in error.
