Sunita Somvanshi
Origin Energy has been ordered to pay $17.6 million after admitting to breaches of Victoria’s energy rules that affected nearly 670,000 customers. The record penalty, handed down in the Victorian Supreme Court, marks the largest financial penalty for breaches of energy rules in the state’s history.
Widespread Customer Impact
The breaches, which occurred between December 2021 and May 2023, affected customers across multiple categories:
- More than 655,000 customers did not receive adequate “best offer” messaging that could have helped lower their energy bills
- 6,806 customers experiencing payment difficulties weren’t provided proper support
- 78 customers were overcharged
- 411 customers had undercharged amounts recovered beyond the four-month back-billing limit
- 10 life support customers had their critical information improperly maintained
Justice Michael Osborne emphasized that the penalty needed to have “sufficient sting” to deter future violations. He noted that without penalties of “sufficient magnitude,” other energy retailers might lower their compliance standards to save costs.
Regulator Takes Strong Stance
The Essential Services Commission (ESC), Victoria’s energy regulator, took Origin to court after discovering the non-compliance.
“We wanted the penalty to send a message about the importance of these rules, and we’re pleased these record penalties have done that,” said Gerard Brody, chairperson and commissioner of the ESC.
Brody added that the decision “will reverberate in the boardrooms of all energy retailers,” making it clear that “compliance with consumer protections requires investment and attention, it cannot be an afterthought.”
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Origin’s Response and Remediation
Jon Briskin, Origin’s retail executive general manager, apologized for the breaches and committed to improving compliance.
“We are sorry we didn’t meet our regulatory obligations for these customers, and we are committed to doing better with significant resources dedicated towards improving compliance performance,” Briskin said.
The company claimed many breaches resulted from errors in their legacy customer service platform or human mistakes. Origin reported that affected customers “suffered no or limited loss or damage” and that they had “remediated affected customers where appropriate.”
Origin has implemented a new customer service platform called Kraken, which they expect will deliver improved compliance outcomes.
Beyond Financial Penalties
In addition to the fine, the court ordered Origin to:
- Implement additional quality assurance measures
- Run extra compliance training for staff
- Publish public notices about the contraventions in major Melbourne newspapers
- Pay the ESC’s legal costs
This isn’t Origin’s first significant penalty. The company paid a similar fine ordered by the Federal Court in 2022 for breaching obligations to customers experiencing hardship and payment difficulties.
In January, the ESC also fined Origin $1.6 million for sharing family violence victims’ private details without consent and pursuing unpaid bills from survivors.
The energy sector has seen other major penalties recently, with AGL fined $25 million by the Federal Court in December for a Centrepay scandal that involved overcharging vulnerable welfare recipients.
As energy costs continue to rise, these penalties highlight the critical importance of energy retailers maintaining compliance with consumer protection regulations, particularly for vulnerable customers.
Frequently Asked Questions
Origin Energy breached Victorian energy rules in several ways between December 2021 and May 2023. The main violations included failing to provide “best offer” messaging to over 655,000 customers, not supporting nearly 6,800 customers with payment difficulties, overcharging 78 customers, recovering undercharged amounts beyond the legal timeframe from 411 customers, and failing to maintain proper information for 10 life support customers. These breaches affected nearly 670,000 customers in total.
This $17.6 million fine is the largest financial penalty for breaches of Victoria’s energy rules in the state’s history. It’s comparable to Origin’s previous Federal Court fine in 2022 for similar breaches related to customers experiencing hardship. For context, AGL was fined $25 million by the Federal Court in December for overcharging vulnerable welfare recipients in what was called the “Centrepay scandal.”
“Best offer” messaging is a requirement for energy retailers in Victoria to inform customers about potentially better energy plans that could save them money. When retailers fail to provide this information, customers might remain on more expensive plans without knowing cheaper options exist. This is particularly important during times of rising energy costs when households are looking to reduce bills.
According to Origin Energy, affected customers “suffered no or limited loss or damage,” and the company has “remediated affected customers where appropriate.” However, specific details about the remediation process and compensation amounts weren’t provided in the court documents. The fine money goes to the government rather than directly to affected customers.
Origin Energy has implemented a new customer service platform called Kraken, replacing their legacy system that was blamed for many of the errors. The court has also ordered Origin to implement additional quality assurance measures and conduct extra compliance training for staff. The company will need to publish public notices about the contraventions in major Melbourne newspapers as well.
If you were an Origin Energy customer in Victoria between December 2021 and May 2023 and believe you might have been affected by these breaches, you should contact Origin Energy directly to inquire about your account. You can also reach out to the Essential Services Commission (Victoria’s energy regulator) if you’re unsatisfied with Origin’s response. Additionally, you have the right to contact the Energy and Water Ombudsman Victoria for independent dispute resolution.
