An Embedded Network (Guideline) Refresher

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If you own, operate or control a private embedded network, you will need to ensure that you hold the exemptions you require. In all of the Eastern States of Australia, this will mean that you will need a network exemption issued pursuant to the AER’s Electricity NSP Registration Exemption Guideline (Network Exemption Guideline).

In this post, we answer some of the most common questions when it comes to embedded networks that are regulated by the Network Exemption Guideline.

When is a Network Exemption Required?

Anyone who owns, controls or operates an embedded network will require registration or an exemption. As the AER notes, even the simple act of allowing a cleaning contract to plug in a vacuum in your office may be considered to be providing a distribution service under the NEL. The exemption framework exists to allow a variety of distribution activities to be conducted with less regulatory burden.

Can a Trust hold a Network Exemption?

No. An exemption can only be held by a ‘person’ (refer to clause 11(2) of the National Electricity Law and clause 2.5.1 of the National Electricity Rules). An exemption can be held by a trustee.

What if there are multiple parties who own, control or operate the Embedded Network?

Each party will need to register for an exemption.

When do I need an individual embedded network exemption?

Where none of the specified classes of exemption applies or where you are seeking a variation of the standard conditions applicable to one of the classes of exemption, you may need to apply to the AER for an individual exemption. The holder of an individual exemption must comply with the conditions that are attached to the exemption by the AER.

Where can I see what conditions apply to my Embedded Network?

The class exemption conditions are set out in the AER’s Network Guidelines.

What if my Embedded Network is in Victoria?

In Victoria, both the AER and the ESC have jurisdiction and regulate private embedded networks. You will need to ensure that you comply with both the Network Exemption Guideline and the ESC’s equivalent document.

Is the law regulated Embedded Networks changing?

Yes, there are a number of proposed changes to the regulation of embedded networks in NECF and in Victoria. Be sure to keep an eye out on our website to be notified of changes or contact us.

What documentation will I need to set up an Embedded Network?

If you are proposing to set up an Embedded Network you are likely to need the following documents:
1. Disclosure documents: including where you are converting an existing building into an embedded network;
2. Customer supply agreement: covering the sale of electricity to consumers;
3. Network usage agreement: covering a situation where one of your embedded network customers ‘opts out’ of the embedded network.
4. Various policies and procedures including those relating to the resolution of customer complaints, the management of your compliance obligations, and ‘opting out’ of your embedded network.
If you need documentation for an embedded network, get in touch with us today and we

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