Market Development

A series of major reforms over the past 25 years have established sophisticated energy markets in Australia that are delivering benefits for consumers across Australia.

Spotlight on competition

The COAG Energy Council (the Council) has put in place annual reviews of energy retail competition as well as price trends, both of which help monitor market development and identify areas for further review and analysis.

Market reviews and advice can be found on the Australian Energy Market Commission’s (AEMC’s) website here.

Consumer choices driving market change

The AEMC is implementing the Power of Choice reforms initiated by the Council to increase options for families and businesses to minimise future energy price rises.

Power of Choice is all about opportunities for consumers to make informed choices about how they use energy; and incentives for efficient investment so community demand for energy services can be met by the lowest cost combination of demand and supply options.

Effectively managing energy demand contributes to reducing the cost of supply. A shift in use away from peak periods or a general reduction in consumption can delay investment in generation, poles and wires, reducing overall cost and ultimately lowering prices for everyone.

This market development program helps facilitate the ability of consumers to make the choices that suit their individual circumstances best and encourages technological innovation; energy conservation and efficiency; peak demand shifting; fuel substitution; and local generation.


The network reform program developed over the past three years has been extensive. By July 2017 the prices people pay will reflect the different ways they use electricity and the costs of providing it to them.

The Australian Energy Regulator (AER) is implementing new network rules (made in 2012) which affect the costs which make up to 50% of people’s bills. Prices are starting to fall following AER determinations which take into account business efficiency benchmarks. The AER is also now required to release comparative reports on network business performance.

The way we pay for power is changing to keep pace with modern lifestyles. When prices reflect how much it costs to use different appliances at different times, consumers will be able to make more informed decisions in the face of changing energy products and services and increasingly competitive energy deals.

New cost-reflective network rules (made in 2014) mean consumers who reduce demand at peak times could save money and help reduce the need for further network investment – reducing costs for everyone over time.

Metering and consumer information

One of the Council’s most important reform elements has been the implementation of the National Energy Customer Framework (NECF). The NECF includes the National Energy Retail Law and the National Energy Retail Rules which have increased protections for consumers.

Further information on the NECF is available here.

Looking forward

Rapid advancements in technology have enabled widespread adoption of distributed (local) generation; smart metering; connected home appliances and services; and emerging off-grid game-changers like storage.

The boundaries between what needs to be subject to economic regulation and where competition is working to benefit consumers are being redrawn as consumers use better information and comparison shopping to participate confidently in the transforming energy market.