AEMC Pricing Review Discussion Paper

Submission by the Australian Council of Trade Unions in response to the AEMC Pricing Review 2025 Discussion Paper

Summary

The ACTU welcomes the AEMC pricing review’s focus on supporting better outcomes for consumers. Decades of radical, market-driven policy experiments applied to Australia’s electricity industry have led to escalating energy prices for consumers while creating uncertainty about the security and sustainability of electricity supply. Energy affordability is a significant factor that determines the well-being of low-income Australians – 40% of all households. Australian households and workers have been hardest hit by the rapid escalation in electricity prices evident since the 2000s, which have contributed significantly to the ongoing cost-of-living pressures suffered by millions of Australians.

The 2024 Inquiry into price gouging, led by Professor Allan Fels AO for the ACTU, found that energy retailers’ practices are harming working families in Australia. The inquiry highlighted three main market failures: concentrated wholesale markets enabling price gouging, inefficient networks and transmission, and retail price discrimination that limits competition. These structural problems across the electricity market drive up prices and restrict consumer choice. The AEMC pricing review should address recent price shocks and the evidence of price gouging identified by the Inquiry.

This review marks an important opportunity to thoroughly reconsider how energy, an essential public service, is delivered, priced, and overseen, and to evaluate whether core elements like network tariffs, retail charges, and cost recovery are effectively promoting both fairness and efficiency for the lasting benefit of all consumers. To ensure the pricing framework supports future consumer demand while delivering a lower-cost system for all, this submission recommends that the review process consider the following reforms in line with its overarching objectives.

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