ACCC accepts informal undertaking for alleged misleading carbon price claims

The Australian Competition and Consumer Commission (ACCC) has accepted informal undertakings from Polaris Solar and ACT Renewable Energy for claims regarding the impact of the carbon price on household electricity prices that the ACCC considered were likely to mislead. This follows a recent warning from law firm Maddocks that companies which improperly inflate prices following the introduction of the carbon price are risking class actions.

Polaris Solar and ACT Renewable Energy are suppliers of solar panels. Between October 2011 and February 2012 in WA, and January 2012 and February 2012 in the ACT, they produced and distributed leaflet advertisements to households promoting the sale of solar panels by claiming that electricity prices would increase by 20% due to the introduction of the carbon price alone, and that if this continued, by 2019 electricity prices would increase by over 400%.

The advertisements also represented that the figures were based on independent studies, when in fact they were based on unverified claims in a newspaper advertisement.

“The ACCC is of the view that these representations were clearly misleading. There was no reasonable basis for these claims to be made,” ACCC acting Chairman Michael Schaper said.

Polaris Solar and ACT Renewable Energy have fully cooperated with the ACCC, offering to not engage in similar conduct in the future and to ensure all of its directors attend practical training on the Australian Consumer Law.

“If a business claims that a potential price rise is linked to the carbon price, the claim must be truthful and have a reasonable basis,” Dr Schaper said.

“Businesses must be careful in relying on unverified statements by third parties, including those made in newspaper articles and advertisements about the impact of the carbon price, as a basis for their claims.”

The ACCC is investigating any alleged misleading claims about the impact of the carbon price that come to its attention, including through the media.

The ACCC has issued an updated Carbon price claims: Guide for business, which provides guidance to assist business in understanding their rights and obligations when making claims about the impact of the carbon price. The guide also gives practical guidance on specific issues experienced by small businesses and gives examples to illustrate how the guidance applies in practice.

Further information is available at www.accc.gov.au/carbon. Complaints can be made on 1300 303 609, online or in the ACCC’s forthcoming webinar for small business, with registration to open soon.