Articles

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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Modernising Electricity Regulation: The AES Framework and Embedded Networks in Western Australia

Modernising Electricity Regulation: The AES Framework and Embedded Networks in Western Australia

Embedded Networks, WA Energy Compliance
Background The existing licensing framework overseeing the sale and supply of electricity in Western Australia (WA) has struggled to adapt to the rapid expansion of emerging and atypical electricity business models in recent years. To address this, in 2019, the then Minister for Energy commissioned Energy Policy WA to assess the regulatory framework in Western Australia. In 2020, Energy Policy WA initiated consultations on a proposed regulatory framework for various categories of 'alternative electricity services' called the Alternative Electricity Services (AES) registration framework. This framework aims to apply customer protection obligations to persons providing electricity services through atypical business models not covered by the existing licensing framework, or where the current framework is deemed inadequate. Legislative amendments to the Electricity Industry Act 2004 (WA) to give effect to the AES…
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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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AER hardship review concludes there is room for improvement

AER hardship review concludes there is room for improvement

AU Energy Compliance, Compliance
Introduction The Australian Energy Regulator (AER) conducted a comprehensive hardship compliance review of several energy retailers, assessing their adherence to obligations towards customers facing financial hardship under the National Energy Retail Law and the National Energy Retail Rules. AER powers The AER, under section 206 of the National Energy Retail Law, holds the authority to issue compulsory notices to energy retailers. This review was a key project under the AER's 2022-23 Compliance and Enforcement Priority. Key findings of the review Identifying hardship customers: Some retailers were found to inadequately identify customers experiencing payment difficulties, with an over-reliance on customers to self-identify. In contrast, other retailers had proactive systems to identify and support such customers effectively. Informing customers of hardship policies: There was variable compliance in informing customers about the retailer’s…
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Voluntary Embedded Network Code of Practice – Western Australia (WA)

Voluntary Embedded Network Code of Practice – Western Australia (WA)

WA Energy Compliance
Background The Voluntary Embedded Network Code of Practice (the Code) was developed by Energy Policy WA, responsible for developing the policy and regulatory framework for the electricity sector in Western Australia. This Code aims to provide similar customer protections and service standards to embedded network customers as those supplied by licensed electricity retailers in Western Australia. During the initial voluntary period of 6 months (with possible extension), learnings from this Code will help inform the development of a mandatory code of practice for alternative electricity services (AES), which may apply to embedded network sellers and other emerging business models that fall outside the licensing framework. The AES framework is expected to be implemented in late 2024 or early 2025. The decision paper outlines feedback received from key stakeholders during the…
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The NT Utilities Commission releases Decision Paper on stage 2 of electricity licensing regime review

The NT Utilities Commission releases Decision Paper on stage 2 of electricity licensing regime review

Compliance, NT Energy Compliance
In 2022, the Utilities Commission of the Northern Territory (the Commission) commenced a review of the Territory’s licensing regime which aims to clarify and enhance the operation of the licensing regime.  The review is being undertaken in three separate components (stages): Stage 1: a review of the coverage, relevance and flexibility (scope and design) of the licensing regime Stage 2: a review of the consistency, efficiency and effectiveness of the form and content of licences Stage 3: a review of the efficiency and effectiveness of the Commission’s licensing and related reporting The Decision Paper released in August 2023 marked the completion of Stage 1, focusing on refining the scope and design of the regime. This Decision Paper, released in January 2024, finalises stage 2, presenting the Commission’s decisions on new…
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