Compliance Quarter’s Submission to the AER’s Review of the Compliance Procedures and Guidelines

Compliance Quarter’s Submission to the AER’s Review of the Compliance Procedures and Guidelines

AU Energy Compliance
On 11 April 2024, Compliance Quarter put forward its submission on proposed changes to the AER Compliance Procedures and Guidelines. The AER is reviewing its Compliance procedures and guidelines, which set out the manner and form in which energy businesses in jurisdictions that have adopted the National Energy Retail Law must submit compliance information and data to the AER. We argue that there should be consideration of measures to incentivise early reporting of potential breaches. These may, for example, take the form of firm discounts to the maximum civil penalty that can result from non-compliance. Clearly, it is the obligation of entitles to comply and to report however as in other spheres, incentives make a difference and can influence behaviour. While changes would be required at the legislative level, we argue…
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Obligations of Energy Retailers Regarding Best Offer Information

Obligations of Energy Retailers Regarding Best Offer Information

AU Energy Compliance, Victorian Energy
Energy retailers in Victoria have specific obligations under the Energy Retail Code of Practice to provide clear information to customers about their 'best offer' - that is, the plan that would minimize the customer's energy costs based on their usage history. The objective is to ensure small customers can easily understand whether they are on the retailer's best plan for them and how to access the retailer's best offer if not. One of the significant challenges in the energy sector (as in banking and elsewhere) is that customers who sign up to offers do not necessarily shop around and end up paying more than they could pay elsewhere or even on a different product with the same provider. The 'best offer obligations' was an attempt to address this. This article is intended as a summary of the Victorian…
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Guide to the National Energy Retail Rules

Guide to the National Energy Retail Rules

AU Energy Compliance
The National Energy Retail Rules (NERR) are a set of rules that govern the sale and supply of electricity and gas by retailers to consumers in Australia, alongside the related National Energy Retail Law (NERL). The NERR came into effect on 1 July 2012 in Tasmania, the Australian Capital Territory, and the Commonwealth. South Australia followed on 1 February 2013, New South Wales on 1 July 2013, and Queensland on 1 July 2015. The NERR do not yet apply in Victoria, Western Australia, or the Northern Territory. Purpose and Scope The purpose of the NERR is to promote efficiency and competition in retail energy markets, ensure appropriate consumer protections, support informed customer choice, and regulate the processes for customer interactions with energy retailers and distributors. The NERR cover a wide…
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How to Manage Multiple Compliance Deadlines: A Case Study

How to Manage Multiple Compliance Deadlines: A Case Study

AU Energy Compliance, NT Energy Compliance
Compliance managers in the energy sector are constantly juggling a large work load with competing deadlines. Managing time effectively is a core skill for compliance managers. In this article, we will present a hypothetical case study of a compliance manager in an energy retailer who has to juggle multiple compliance tasks and deadlines, and how they can use some strategies and tools to manage their workload and prioritise effectively. We will also share some insights and tips from Compliance Quarter, a consultancy that helps energy businesses with regulatory compliance. The Case Study Meet Alice, a compliance manager in a medium-sized energy retailer that operates in several states and territories. Alice is responsible for ensuring that the retailer complies with the relevant laws, rules, codes, and standards that apply to its…
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How to Avoid Compliance Risks by Effective Communication: A Case Study

How to Avoid Compliance Risks by Effective Communication: A Case Study

Compliance, NT Energy Compliance
Compliance managers in the energy sector face many challenges in ensuring that their businesses comply with the regulatory framework. One of the most common and frustrating situations is when their advice is ignored or overridden by senior management or other stakeholders, exposing the business to potential compliance risks and penalties. In this article, we will present a hypothetical case study of a compliance manager in an energy retailer who faced this scenario and how it affected the business outcomes. We will also provide some practical recommendations for compliance managers on how to communicate effectively within the business and avoid compliance risks. The Case Study Anna is a compliance manager in a medium-sized energy retailer that operates in several states. She has been working in the energy sector for over 10…
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How to Choose a New Billing System for Energy Retailers

How to Choose a New Billing System for Energy Retailers

AU Energy Compliance, Compliance, NT Energy Compliance, NZ Energy Compliance
Billing is a vital part of the energy retail business. It involves calculating and collecting the charges for the energy services provided to the customers, as well as complying with the regulatory obligations and reporting requirements of the energy market. A good billing system can help the energy retailer to improve its operational efficiency, customer satisfaction, and competitive edge. However, many energy retailers are struggling with their existing billing systems, which may be outdated, unreliable, or inadequate for the changing needs and expectations of the market. Some of the common problems that energy retailers face with their billing systems are: Lack of flexibility and functionality. The billing system may not be able to handle the complexity and diversity of the energy products and services, such as time-of-use tariffs, demand response…
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How to Build an Effective Energy Retailer Compliance Program

How to Build an Effective Energy Retailer Compliance Program

AU Energy Compliance, Compliance, NT Energy Compliance
It is very difficult for energy retailers who are operating independently of one another to understand what an effective compliance management program is. Typically, the only feedback that they receive is from regulators when something goes wrong i.e. when there is a breach that they are required to report on, and they subsequently go through an investigation and enforcement process. Regulators themselves do not fully understand the compliance function’s roles and responsibilities- they typically see the tail end, what goes wrong, and not the work that goes in to avoiding non-compliance. Compliance Quarter has the advantage of having worked with a number of energy retailers and as a result is in a unique position in being able to explain what an effective compliance program looks like. So, what are some…
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Identification of Customers Affected by Hardship: Rules and Steps for Retailers

Identification of Customers Affected by Hardship: Rules and Steps for Retailers

AU Energy Compliance
In the retail sector, particularly within the energy market, identifying customers experiencing hardship and providing appropriate assistance is not only social obligation but also a regulatory requirement. This article outlines the specific rules that apply generally to retailers and the steps they should take to assist customers facing hardship, as stipulated by the National Energy Retail Rules Version. Understanding Hardship in the Retail Context A retailer's customer hardship policy must include a clear description of the process for assessing the eligibility of a customer for its hardship program. This process is crucial as it determines which customers are in need of assistance. A challenge that is faced by consumers is the understandability of a retailer's hardship policy. Such policies seek to translate complex regulatory obligations into language that can be understood and…
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The Victorian Renewable Energy Condition (embedded networks)

The Victorian Renewable Energy Condition (embedded networks)

Embedded Networks, Victorian Energy
In response to an enquiry into embedded networks in Victoria, the Victorian government gazetted the 2022 General Exemption Order with new requirements for residential embedded network. Chief among those was the 'Renewable Energy Condition' that applies to any entity operating under the VR2 exemption. Let's delve into the specifics of when this condition applies, how it operates, and the implications for compliance. Anyone who proposes to rely on the VR2 exemption must ensure that they obtain independent legal advice- noting that this article is a summary and is not intended to be an exhaustive review of relevant compliance obligations. Applicability of the Renewable Energy Condition The renewable energy condition applies to new embedded networks with 10 or more residential customers. An embedded network is a private electricity network that serves multiple premises and is…
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Virtual Power Plants: Reshaping Energy Markets and Empowering Consumers

Virtual Power Plants: Reshaping Energy Markets and Empowering Consumers

AU Energy Compliance, Consumer, NT Energy Compliance
The traditional electricity grid is undergoing a fundamental shift as distributed energy resources (DERs) like solar panels, batteries, and smart appliances proliferate. Virtual Power Plants (VPPs) are at the forefront of this transformation. A VPP is a cloud-based network that intelligently links DERs, allowing them to collectively function as a distributed power plant This can provide crucial grid services like frequency regulation and voltage support [1]. How Do VPPs Impact Customers? VPPs open up new possibilities for customers both on an individual basis and collectively. Potential Cost Savings: VPPs allow customers to earn payments for making their energy resources accessible during peak times. This reduces reliance on costly fossil-fuel 'peaker plants', potentially lowering overall electricity bills [2]. Resilience and Reliability: VPPs can dispatch backup power from DERs during outages, improving grid resilience for customers [2].…
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