ACCC proposes to authorise large retailers to negotiate discounts with suppliers

ACCC proposes to authorise large retailers to negotiate discounts with suppliers
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The Australian Competition and Consumer Commission (ACCC) has released a draft determination which proposes to authorise members of the Large Format Retail Association (LFRA) to jointly tender and negotiate cheaper prices with electricity suppliers.

The ACCC has also granted interim authorisation to the LFRA, allowing members to begin the initial stages of the tendering and negotiation process while the ACCC completes its assessment.

ACCC Commissioner, Stephen Ridgeway said, “LFRA and its members want to jointly tender so they can pay less for their electricity. 

“We propose to allow this joint tendering because we expect it will lead to more competition between suppliers for the group’s combined electricity demand.”

“Collectively tendering is also likely to save retailers time and money compared to individual negotiations for electricity supply.”

The arrangements are unlikely to cause any significant public detriments, given participating LFRA members’ aggregate demand for electricity is a very small proportion of total electricity consumption of electricity in each State and Territory.

The ACCC’s authorisation would also allow LFRA to add new members to the group in the future, provided the total demand of the group does not exceed one per cent of the annual consumption of electricity any state or territory.

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