An Australian energy giant, Origin Energy, is being taken to court for allegedly siphoning millions of dollars from thousands of its most economically vulnerable former customers. The case serves as a critical cautionary tale for Kenyan consumers and regulators overseeing essential services like power and mobile money.

The Australian Energy Regulator (AER) alleges that Origin Energy illegally took approximately $2.5 million (approx. KES 213 million) from over 3,400 customers who were recipients of government welfare. The company allegedly continued to make deductions through a welfare payment system called Centrepay for up to six years after the customers had closed their accounts and owed no money.

The regulator has slammed the alleged conduct, with AER Chair Clare Savage noting her concern for the victims. "Many customers affected by this alleged conduct were likely experiencing economic vulnerability and could have otherwise used the money they were overcharged to spend on essentials," Savage stated. The AER further alleges that Origin was aware of systemic flaws that allowed the overcharging to occur as early as 2017.

A Pattern of Negligence?

This is not the first time Origin Energy has faced regulatory action. The company has previously been penalised for failing its obligations to customers requiring life support equipment and for breaches related to protecting customers experiencing financial hardship. The current allegations involve more than 77,000 breaches of Australian energy laws. Two other energy firms, AGL and Alinta Energy, have already been penalised millions of dollars for similar mishandling of the Centrepay system.

The key allegations against Origin include:

• Illegally deducting a combined $2.5 million (approx. KES 213 million) from 3,400 former customers.
• A single customer being overcharged by as much as $11,000 (approx. KES 938,000).
• Failing to inform customers of the overcharging or refund them in a timely manner.
• The alleged illegal deductions occurring over a period from December 2019 to March 2025.

Lessons for the Kenyan Consumer

While this scandal unfolds in Australia, it highlights the universal risk of corporate overreach and the critical need for robust consumer protection. In Kenya, bodies like the Competition Authority of Kenya (CAK) and the Energy and Petroleum Regulatory Authority (EPRA) are tasked with safeguarding consumer rights. The CAK has previously penalised companies for anti-competitive conduct and abuse of buyer power, demonstrating a commitment to holding firms accountable.

This case underscores the importance of vigilance from both regulators and consumers. Kenyans who feel they have been wronged by service providers have avenues for complaint and redress. The Australian case is a stark reminder that even automated payment systems can fail, and the consequences often fall heaviest on those who can least afford it.

An Origin spokesperson acknowledged the company's shortcomings, stating, "We regret that we did not manage Centrepay deductions for our former customers as we should have and apologise to all those affected." The company noted it had self-reported the issue and was working to refund customers. The AER is seeking penalties, customer compensation, and the implementation of a new compliance program.