What is the difference between a secret trailing commission collected by a financial adviser and a hidden fee claimed by an energy switching company that gets between a household and its electricity company? Both come out of a consumer's wallet. Only one faces intense regulation. What is the difference between the complexity of the home loan market and the complexity of the household electricity market, which now comes with "discounts" that might not reduce your bill? Home loan offers are probably simpler. It defies reason to see that practices being slashed in financial services are growing like weeds in the energy business. After years of scandals in financial advice, those who help clients with their finances and superannuation are now subject to laws that guarantee close scrutiny. In the electricity business, the switching companies that claim to help customers with their bills operate under a voluntary code of conduct instead. The stakes are higher in financial advice, given a family's entire assets can be at risk. And in the energy industry's defence, it has not thrown up cases where companies have broken the law like the Commonwealth Bank did on money laundering, as it acknowledged in its $700 million settlement earlier this month.

Even so, the tougher standards being applied in one part of the economy are missing in another. It is only a matter of time before things change. A report being released on Friday highlights the scale of the problem. The annual retail report from the Australian Energy Market Commission finds that consumer trust in the energy companies has fallen from 50 to 39 per cent in the last year. Consumers rate them worse than banks. Worse, the report finds that a profusion of customer offers still leaves households paying too much for their electricity. A household that switches from a median standing offer to the cheapest market offer could save $574 a year in Victoria, $504 in south east Queensland and $365 in NSW. The saving in the ACT would only be $273, given the market is dominated by one company. Nobody can force consumers to search for a better deal. But the usual response – buyer beware – will not wash with voters or politicians. If the industry does not address this, the political pressure will grow for parliament to impose change through legislation.

The price premiums revealed in the AEMC report are astonishing when compared to the out-of-control rhetoric about energy and climate change over the last dismal decade of policy drift. Kevin Rudd's carbon pollution reduction scheme was wrecked on fears about the damage to consumers when Frontier Economics estimated the average household would pay an extra $260 a year. Julia Gillard's carbon tax was scrapped on similar concerns when Treasury estimated an average increase of $172 a year. Both plans included compensation. Imagine the outcry if households were paying $574 more than necessary because of a climate change policy? Instead, they are paying this as a result of a deliberately confusing marketplace that also offers annual price hikes and, depending on where you live, brownouts and blackouts. The political deadlock on energy and climate has imposed many costs, not least of them the lost opportunity of a putting in place a scheme that might be reducing greenhouse gas emissions by now, but the cost to household budgets is real. It is measured in retail reports like the one from the AEMC on Friday. Everyone pays the price, whether they believe in global warming or not. The AEMC is not a consumer watchdog so it does not name and shame individual companies that are charging too much. It points out the pitfalls of the comparison websites, for instance, but does not rate them according to how well they help consumers.

The AEMC report reveals an industry undergoing a huge transition, with rapid adoption of rooftop solar panels and household batteries. It warns of an industry that "punishes loyalty" and tries to avoid being overly negative by saying retailers are starting to deal with the collapse in consumer trust. It also holds out the prospect of lower or at least stable prices in the year ahead, a scenario that may be good news for the government as it heads to the election. But will consumers trust the promise of lower prices? The report shows most electricity bills rose anywhere between 9 and 22 per cent over the past year. Perhaps some of the effort fighting the climate wars over the last decade should have been put into fighting a few battles for consumers instead.