Law firm Piper Alderman is representing businesses and residents in a proposed class action against Queensland’s two largest electricity generators, Stanwell Corporation and CS Energy.
The claim alleges that Stanwell and CS Energy engaged in “bidding games” or trading strategies during the relevant period (August 1, 2014 to December 31, 2019) which artificially created scarcity of supply and spiked energy prices to the detriment of group members.
This conduct is alleged to have been in contravention of section 46 of the Competition and Consumer Act 2010 (Cth).
According to Piper Alderman, allegations of market abuse by Stanwell Corporation and CS Energy to manipulate the price of electricity have been investigated by the Queensland Productivity Commission, the Australian Energy Market Commission, the Australian Energy Regulator, the Australian Competition and Consumer Commission (ACCC) and the Grattan Institute.
Greg Whyte, head of Piper Alderman’s litigation team in Brisbane said, “This case is about abuse of market power. Stanwell and CS Energy have used their position to unlawfully manipulate the wholesale cost of electricity and that has driven up the prices paid by all Queensland businesses and consumers. It’s had a devastating effect on the Queensland economy. We are trying to stop that behaviour and recoup the losses that illegal conduct has caused. For businesses. For Queenslanders.”
When the class action was announced mid last year, CS Energy said it was extremely disappointed by the proposed class action by Piper Alderman and their privately-funded backers, LCM Finance.
“We reject the claims that they make about CS Energy’s bidding behaviours in the National Electricity Market (NEM),” a CS Energy statement said.
“CS Energy is a proudly Queensland-owned and based company that provides power to some of our state’s biggest industries and employers. More than 500 of our staff live and work in the Queensland communities where we operate, and we will continue to support them and the customers who rely on us to power their operations every day.
“We are particularly concerned on behalf of all Queensland consumers about some of the promises being made to vulnerable families by a privately-funded class action in what has been a tough year for many.
“Our number one priority, as always, is to safely deliver reliable and competitively-priced electricity to power our economy – Queenslanders have had the lowest average wholesale electricity prices in the National Electricity Market for the past three years.
“We will continue to provide jobs and opportunities that support Queensland families and businesses.”
Stanwell echoed CS Energy’s stance saying in a statement: “We understand that Piper Alderman is alleging Stanwell misused its market power to influence wholesale electricity prices.
“We strongly refute any allegation of misuse of market power.
“We are confident we have acted in accordance with the extensive rules which govern the National Electricity Market, and we have always been transparent in our trading activities.
“Stanwell will vigorously defend the class action in court, which will no doubt be a long and complex process.
“We are proud of the hard work our people do every day to generate electricity which keeps the lights on and powers jobs and industry in Queensland.”
The law firm claims Stanwell and CS Energy control around 70 per cent of the electricity dispatched through the Queensland region of the NEM.