Over 46,000 Queensland energy consumers have signed on to Australia’s largest ever energy class-action, seeking compensation from two Queensland government-owned power companies accused of manipulating energy markets to boost their own profits.
Documents commencing the class action lawsuit were lodged in the Federal Court on Wednesday by law firm Piper Alderman, with the class action predominantly representing Queensland households, with more than 1,700 Queensland businesses also joining the action.
The class action is seeking to reimburse Queensland energy consumers for the financial impacts of the alleged market gaming, which include households and businesses paying artificially inflated electricity prices.
The lawsuit has been brought against Stanwell Corporation and CS Energy, two electricity generation businesses owned by the Queensland government.
Stanwell Corporation operates the Stanwell and Tarong coal-fired power stations, while CS Energy operates the Kogan Creek Power Station and Callide B coal fired power stations. Questions have been raised around the bidding practices of the two power stations, suggesting that they were deliberately withholding generation capacity from the market in an effort to push wholesale electricity prices higher.
A report published by the Grattan Institute in 2018 suggested that as much as $800 million a year was being added to energy consumer bills as a result of these sort of gaming practices. The report led to then federal energy minister Josh Frydenberg tasking the Australian Energy Market Commission to investigate the behaviour of the two state-owned companies.
The deal of Piper Alderman’s Dispute Resolution and Litigation team, Greg Whyte, has said that evidence suggests the Queensland generation businesses sought to manipulate electricity prices to maximise their own profits.
“The unlawful conduct occurred at the generation stage, and your retailer simply passed that cost through to consumers. This is why this action is available to all Queensland businesses and residents,” Whyte said.
“The facts indicate, and we will seek to prove, that the defendants manipulated the wholesale cost of electricity for their own profit. It amounts to a hidden tax paid by Queenslanders.
“We brought this action on behalf of Queensland-based businesses and households who have all been affected. The conduct of Stanwell and CS Energy has had a devastating effect on the Queensland economy,” Whyte added.
Litigation funder LCM will cover the costs of the legal action, meaning that there is no cost for affected Queensland households to participate in the class action, which is being run on a ‘no win, no fee’ basis. LCM, however, will be entitled to a share of any compensation awarded as a result of the law suit.
The class action is open to any Queensland electricity user who paid for electricity between 20 January 2015 and 21 January 2021. Eligible Queensland energy consumers are able to register to participate in the class action through a website dedicated to the action.