The impact of COVID-19 on Energy Retailers

The impact of COVID-19 on Energy Retailers

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COVID-19 is having a dramatic impact on all areas of the economy. On an individual level it is resulting in illness, isolation, and a loss of income.Energy retailers provide an essential service that is at the foundation of our economy. In this article we look at the consequences of COVID-19 on energy retailers.Existing Contracts & Key Service ProvidersMany energy retailers are reliant on third party service providers for functions including billing and customer service. Customer service is typically centralised in call centres which may, over the coming months, simply close down or have reduced capacity.Energy retailers should review the contracts they have in place with key service providers and take particular note of the following:Termination for convenienceNow is an important time to review your service provider contracts and the circumstances…
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Attention all caravan parks, strata and other embedded networks: Do you hold all the correct exemptions to sell and distribute energy?

Attention all caravan parks, strata and other embedded networks: Do you hold all the correct exemptions to sell and distribute energy?

AU Energy Compliance
The Australian Energy Regulator (AER)  announced $40,000 in penalties for a caravan park operator for allegedly selling electricity to customers at caravan parks without holding either a retailer authorisation or appropriate retail exemptions, as required to do so by law. There have been several such infringement notices in recent years for entities selling energy without holding the correct exemption.[1]  In light of this, it would be wise for all energy sellers to carry out an internal compliance audit and check that their operations are compliant. The issue Under section 88 of the National Energy Retail Law, any individual that sells energy must hold a retail authorisation of an exemption from the Australian Energy Regulator, when operating in the National Energy Customer Framework jurisdictions (Queensland, NSW, ACT, and Tasmania). Retail or…
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Why Compliance Matters

Why Compliance Matters

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Unsurprisingly, it is our view that compliance matters. We say this in the context of a business environment characterised by increasing and increasingly complex regulation. More Regulation and More Complexity Despite various governments now having ‘deregulation’ Ministers or Departments, the truth is that regulation is increasing. Whether it’s driving home from work in complying with the Road Rules or speaking to a customer at work in complying with the National Energy Retail Rules, much of what we do on a day-to-day basis is regulated.The purpose of regulation is to codify society’s expectations. Society’s expectations are constantly changing, and so, regulation is constantly trying to catch up. This is evident in industries that are marked by technological advance with regulation constantly lagging technological advances. Despite various shortcomings, regulation -by and large…
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How to obtain an energy retail authorisation

How to obtain an energy retail authorisation

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If you’re planning to become an energy retailer in those states that have adopted the National Energy Customer Framework, you will require a retail authorisation issued by the Australian Energy Regulator. Broadly, you will need to demonstrate that you:Have the necessary organisational and technical capability;Have financial resources, or access to resources, to operate as a retailer; andAre a suitable person to hold a retail authorisation.In this post we look at some of the key components of an energy retail authorisation application.   Organisational and technical capability When examining your organisational and technical capacity to hold a retail authorisation, the AER will look at your industry experience, operational systems and staff expertise. In practice this means reviewing the resumes of your key staff, the various policies and procedures that you have to…
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Ausgrid’s Proposed Embedded Network Tariff.

Ausgrid’s Proposed Embedded Network Tariff.

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Ausgrid's Proposal The Australian Energy Regulator (AER) has published its determination on Ausgrid’s proposed Amendments to its Tariff Structure Statement (TSS). The AER has decided to not approve the proposed amendments which would have introduced a new network tariff for embedded networks. The AER was not satisfied that the threshold to amend the TSS had been met.Ausgrid’s current TSS applies for the 2019 to 2024 period, and was approved by the AER in April 2019. In September 2019, Ausgrid submitted a proposal to amend its current TSS. The proposal sought to introduce a new network tariff for certain embedded networks on 1 July 2020. The AER's Consideration and Conclusion In considering the proposed amendment, the AER examined whether an event had occurred that was beyond the Ausgrid’s reasonable control and…
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Increased Retailer Reporting and the CDR in NSW

AU Energy Compliance
At the end of December 2019, the Independent Pricing and Regulatory Tribunal NSW (IPART) released its final report on its Review of the Performance and Competitiveness of the NSW Retail Electricity Market for 2018-2019 (Report). We previously provided an update upon the release of the interim report here. The Report found that smaller retailers have continued to increase market share and that prices fell for those customers engaged in the market. IPART also made three recommendations to the Minister for implementation in NSW going forward. These recommendations are aligned with two significant changes in the energy sector in 2020: i) the Consumer Data Right; and ii) increased price regulation and financial reporting. Recommendation 1: Interval meter data on comparison sites IPART recommended that: “Energy Made Easy and NSW Energy Switch…
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Review of Queensland Energy Legislation

AU Energy Compliance
In mid-2018, the Queensland Government carried out an initial consultation on a Review of Queensland Energy Legislation (the Review). The Review covers the operation of the Electricity Act 1994, the Gas Supply Act 2003, the Energy and Water Ombudsman Act 2006 and the Liquid Fuel Supply Act 1984. Two further documents have now been released for consultation as part of the Review. The first options paper summarises ‘regulatory impact statements’ for a range of proposed changes while a second paper goes into more significant detail with respect to those changes. In this article we summarise the areas of proposed change, focusing on those areas that will impact on authorised retailers and/or embedded networks in Queensland. By Dr Drew Donnelly, Compliance Quarter Rationale for the Review The overarching motivation for the…
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New Reporting Obligations Proposed for Energy Retailers

New Reporting Obligations Proposed for Energy Retailers

AU Energy Compliance
By Alex Silcock, Compliance Quarter Energy Consumers Australia (ECA) has requested amendments to the National Electricity Rules and National Energy Retail Rules to improve retail market transparency. The proposed rule change would require retailers to report of average prices, costs, revenues and margins to the Australian Energy Market Commission (AEMC). Reasoning The rationale for the proposed reporting obligations is to provide the AEMC with a complete picture of the margins of retailers participating in the market and this would assist in the delivery of its annual Retail Energy Competition Review. ECA cite comments made by the AEMC in its 2019 Retail Energy Competition review, along with recommendation 40 of the Australian Competition and Consumer Commission’s (ACCC) Retail Electricity Price Inquiry (REPI) in support of the rule change request. The AEMC…
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