Mojo Power: How One Retailer's Collapse Tested Australia's Consumer Protection System

Mojo Power entered Australia's electricity market with the ambition of challenging the major energy retailers through competitive pricing and customer-focused service. As an independent retailer, the company quickly built a customer base across the National Electricity Market (NEM), offering an alternative to the established energy companies. However, like many smaller retailers, Mojo Power became increasingly exposed to rising wholesale electricity costs and changing market conditions. In 2023, the company entered liquidation, becoming another casualty of one of the most turbulent periods in Australia's energy market history.

Mojo Power was granted an electricity retail authorisation by the Australian Energy Regulator (AER) in 2015 and expanded into multiple states across the National Electricity Market.

Unlike the large integrated energy companies that own power stations and other generation assets, Mojo Power primarily purchased electricity from the wholesale market before selling it to households and businesses.

During periods of stable wholesale pricing, this business model allowed the company to compete aggressively on price. However, it also meant the retailer was more exposed when wholesale electricity costs increased rapidly.

Throughout 2022 and into 2023, Australia's electricity market experienced unprecedented volatility. Retailers faced a combination of challenges including record wholesale electricity prices, high international coal and gas prices, inflation increasing the cost of electricity generation, reduced electricity supply following outages at several coal-fired power stations, and increased financial pressure on retailers without large generation assets or long-term wholesale hedging strategies.

For many smaller retailers, maintaining competitive prices while absorbing these higher costs became increasingly difficult.

On 15 June 2023, the Supreme Court of Queensland ordered the winding up of Mojo Power Pty Ltd, placing the company into liquidation.

Following the court's decision, the Australian Energy Regulator revoked Mojo Power's electricity retail authorisation and activated the Retailer of Last Resort (RoLR) framework.

Under this consumer protection process, affected customers were automatically transferred to designated electricity retailers, including Origin Energy and EnergyAustralia depending on their distribution network. Customers did not lose electricity supply, did not need to organise an emergency transfer themselves and continued receiving power while their accounts were transferred to their new retailer.

The transition occurred under the National Energy Retail Law and was designed to minimise disruption for households and businesses.

Mojo Power's collapse was part of a broader wave of retailer failures and exits during 2022–2023. The loss of another challenger brand further consolidated the market around large, vertically integrated retailers with generation assets.

The Retailer of Last Resort process functioned as designed, customers experienced no supply interruption, but the transfers typically moved customers onto default rates that were higher than their original Mojo Power plans. This meant affected customers needed to actively compare plans again to avoid paying more than necessary.

The event reinforced the structural divide in Australia's retail electricity market: retailers with generation assets can absorb wholesale shocks, while those without face existential risk during periods of extreme price volatility.

Mojo Power's collapse demonstrated one of the strongest consumer protections built into Australia's electricity market. The Retailer of Last Resort (RoLR) scheme.

Many people assume that if their electricity retailer fails, their power will immediately be disconnected. In reality, the retailer sending your bill is different from the network business that owns and operates the poles, wires and infrastructure delivering electricity to your home.

When an authorised retailer exits the market unexpectedly, the Australian Energy Regulator works with the industry to automatically transfer customers to another approved retailer, ensuring electricity supply continues without interruption.

While customers should still compare plans after being transferred, the system is designed to protect consumers from losing access to an essential service.

Mojo Power's story is a reminder that although individual retailers can fail, Australia's electricity market has safeguards in place to maintain reliable supply and provide stability during periods of market disruption.