AU Energy Compliance

Impacts

It is our corporate mission to provide regulatory services that result in a more sustainable and just society. We are selective in who we work

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AU Energy Compliance

Having regard to a customer’s capacity to pay: a Federal Court Decision

The decision of Australian Energy Regulator v Origin Energy Electricity Ltd (2020) FCA 802 should be reviewed by all energy retailers operating in NECF jurisdictions.

As the regulatory demands of energy sellers increase over time, there is an understandable move towards automation. When set up correctly, automation can be used to reduce regulatory burden and to improve customer’s experiences. 

This decision serves as a timely reminder of the critical importance of compliance when it comes to automating such processes.  A failure to properly build in compliance into automation can result in a large number of breaches occurring over a significant period of time and ultimately, significant civil penalties being paid.

Image created using OpenAI’s DALLE-2

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Queen Victoria Building or QVB, Sydney, NSW, Australia.
AU Energy Compliance

The new Retail Exempt Selling Guideline

The new Retail Exempt Seller Guideline should be reviewed in detailed by all exempt sellers operating in NECF jurisdiction which includes NSW, QLD, ACT, TAS and SA. The Guideline was developed as part of the AER’s review into the Retail and Network Exemption Guidelines. The AER has decided to defer release of the draft Network Service Exemption Guideline (Version 7) while further changes are made to streamline and simplify the document. It is anticipated that the revised Network Service Provider Exemption Guideline will be published in August 2022. The new Retail Exempt Seller Guideline takes effect from 15 July 2022.

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Close Up Of Power Cable Charging Electric Car Outdoors In Supermarket Car Park
AU Energy Compliance

2022-2023 Compliance and Enforcement Priorities of the AER

The Australian Energy Regulator has published its 2022-2023 Compliance and Enforcement Priorities. The AER will continue to focus its compliance and enforcement activities on how retailers assist customers who are facing financial difficulties and those who are within embedded networks.

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Gas stove burner
AU Energy Compliance

Who claims and who pays: the administered price cap (APC) compensation process

The APC compensation scheme allows certain entities to claim compensation via AEMO and the AEMC where their total costs exceed their total revenue from the spot market over an eligible period. Entities that may be entitled to claim include scheduled and non-scheduled generators, scheduled network service providers, market participants in respect of a scheduled load, demand response service providers and ancillary service providers.

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Live coals
AU Energy Compliance

NSW Energy Minister granted emergency powers to direct coal to fuel electricity generators

The NSW Energy Minister, Matt Kean, has been granted emergency powers under the Essential Services Act 1988 to direct coal companies to provide coal to generators. These powers were granted in response to the current energy market crisis.

We haven’t been publishing much about the current energy market crisis as we, like many in the industry, have been in the thick of it. However, from today, we will publish analysis of the regulatory responses of AEMO and state Governments. So, what do the powers allow the Minister to do and do they have any teeth?

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AU Energy Compliance

Unaccounted for Energy (UFE) Rule Change: Global Settlement

The Australian Energy Market Commission (AEMC) has implemented a new rule which commenced (after delay) on 1 May 2022. The new rule relates to a change in the current market settlement framework. The rule changes the framework from the previous framework of ‘settlement by difference’ to a ‘global settlement’ framework.

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Aerial view of angled multi color cargo containers, Port Melbourne, Melbourne, Victoria, Australia
AU Energy Compliance

Increase to cap on discounts for paying energy bills on time (Victoria)

The Essential Services Commission has increased the amount energy retailers can charge Victorian customers who do not make their payment on time to 5.71 per cent. The cap applies to ‘pay-on-time’ discounts that are conditional upon the customer paying a bill on or before the pay-by date. 

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electricity pylon on lake
AU Energy Compliance

EnergyAustralia ordered to pay a pecuniary penalty of 12 million dollars in respect of contraventions relating to customers who reside at premises where life support equipment is required.

On 3 June 2022, the Honourable Justice Colvin of the Federal Court of Australia published reasons for judgment in proceedings commenced by the Australian Energy Regulator against EnergyAustralia alleging numerous contraventions of provisions in the National Energy Retail Rules concerned with procedures to protect customers who depend upon electricity supply for the operation of life support equipment.  All energy retailers and exempt sellers should carefully review the reasons given by Justice Colvin and ensure that they will not repeat the mistakes made by EnergyAustralia.

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Solar panel on a wooden house
AU Energy Compliance

Updating the Distributed Energy Resource (DER) Register

The Australian Energy Market Operator (AEMO) is required by law to keep a register of distributed energy resources (DER). The Register is designed to assist AEMO in relation to grid security and stability. DER installers and electricity network service providers (NSPs) are responsible for providing the relevant information to AEMO via the register.

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The elegant Matagarup Bridge over the Swan River in Perth, Western Australia at night.
AU Energy Compliance

The WA Electricity Retail Market

The WA electricity industry operates differently to the NEM number of respects.  Customers that operate within the South West Interconnected System (SWIS) – the biggest electricity network in Western Australia – are split into two categories: Non-contestable and Contestable customers.

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solar energy
AU Energy Compliance

Review of the Authorisation and Exemption Framework

The Australian Energy Regulator has published a consultation issue paper titled Retail Authorisation and Exemption Review. Broadly, the Issues Paper considers the changing nature of the energy market, the risks posed by new products and services, and asks whether changes are needed to the Retail Authorisation and Exemption Framework. This is a major consultation that will have long-lasting ramifications for the energy market and consumers.  It builds on the work of the Energy Security Board, the Australian Energy Market Commission (particularly in relation to embedded network regulation) and prior work by the AER.

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Cropped image of business person sticking note on glass window at office
AU Energy Compliance

When should you hire a compliance manager?

If you’re wondering if it’s time to hire a compliance manager, ask yourself how often you think about regulatory compliance and whether your business is across all regulatory obligations with appropriate controls in place. If the answer to the last question is not enough or no, it may be time to take on such an employee.

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Two heads are better than one
AU Energy Compliance

The AER’s Better Bills Guideline

On 31 March 2022, the Australian energy Regulator published the Better Bills Guideline.  The Guideline creates binding and enforceable obligations on energy retailers in respect of their preparation and issuance of energy bills for small customers. This article summarises some of the key obligations of the Guidelines. For detailed instructions on how to implement and comply with the Guidelines, please get in touch.

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AU Energy Compliance

Australian Energy Regulator Releases the Results of its Latest Compliance Audits Under the National Energy Retail Law

The Australian Energy Regulator has published results of its audits into Alinta Energy, Simply Energy, ReAmped Energy and Powershop with a focus on compliance with hardship and disconnection obligations.  The audit results provide important information to all energy retailers as to what is expected when it comes to compliance in these key areas. 

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High Gas prices signs
AU Energy Compliance

Victorian Energy Retail Code of Practice (formerly the Energy Retail Code)

On 1 March 2022, the Victorian Energy Retail Code of Practice took effect.

The rules previously existed in a different iteration (Energy Retail Code), however in December 2021, Victorian legislative changes deemed existing energy codes as ‘codes of practice’. To fully implement the new enforcement framework and effect the conversion, the Essential Services Commission (ESC) undertook a 6 month review and consultation process, which culminated in the final version of the Energy Retail Code of Practice being published.

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Melbourne Aerial View
AU Energy Compliance

The 2022-23 Victorian Default Offer review

Recently we wrote an article about the draft AER 2022-23 Default Market Offer. A parallel process is taking place in Victoria, and on 15 March 2022 the Essential Services Commission (ESC) released their draft decision about the Victorian Default Offer (VDO).

Submissions are open until 12 April 2022 with the release of the final decision in May, and decision to take effect from 1 July 2022. The ESC will hold a public (online) forum for those interested on 31 March 2022.

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Gold Coast Skyline Queensland Australia
AU Energy Compliance

Embedded Network Operators can now join EWOQ

On 28 February 2022, the Energy and Water Ombudsman (Prescribed Energy Entities) Amendment Regulation 2021 (EWO-AR) came into effect. The amendments insert two new sections into the Energy and Water Act 2006 (Queensland) (the ‘Act’).

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Guidelines book
AU Energy Compliance

A New Exempt Seller Guideline (for NECF)

The proposed changes to the Retail Guidelines will result in greater certainty for embedded network operators and consist of sensible and balanced mechanisms designed to introduce additional consumer protections into a growing market.

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Fossil spiral shell and ancient petrified organisms in granite
AU Energy Compliance

Overlooked Embedded Network Regulatory Obligations

Embedded networks are privately owned electricity networks that serve multiple customers with a single connection point to the wider distribution network. The regulatory framework that applies to embedded networks is complex and it can be difficult for embedded network operators to understand and comply with their regulatory obligations.

Here we examine some of the regulatory obligations, in those jurisdictions that have adopted the National Energy Customer Framework, that are commonly ‘overlooked.’

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Stock market prices
AU Energy Compliance

The 2022-23 Default Market Offer

The Australian Energy Regulator has published its draft Default Market Offer (DMO) 2022 to 2023 determination. Submissions on the draft DMO are open until 17 March 2022. The final decision will be published in May with changes to apply from 1 July 2022.

The draft DMO reflects key structural changes occurring in the energy market with wholesale prices expected to increase in the short to medium term, coming off successive decreases in the DMO, and representative of risk of the changing market to energy retailers.

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Princes Pier in Port Melbourne Victoria Australia
AU Energy Compliance

Investigating Regulatory Breaches

For an executive within an energy business, identifying a regulatory breach can be a gut-wrenching experience. Being told that your business has inadvertently breached the law, understandably raises concerns about the impact of the breach on your customers, stakeholders, and reputation.

In this post we look at the steps involved in identifying and reporting on a potential regulatory breach.

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Stock market prices
AU Energy Compliance

Price Comparisons under the Electricity Retail Code

On 12 January 2022, the Australian Competition and Consumer Commission (ACCC) announced that energy retailer CovaU Pty Ltd had paid $33,300 in penalties arising from three infringement notices issued for alleged contraventions of the Competition and Consumer (Industry Code—Electricity Retail) Regulations 2019 (the Code).

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Energy
AU Energy Compliance

AEMO Draft 2022 Integrated System Plan review

On 10 December 2021, the Australian Energy Market Operator (AEMO) published the Draft 2022 Integrated System Plan (ISP) (Draft ISP). This was subject to a ‘transparency review’ by the Australian Energy Regulator (AER), released 7 January 2022.  The Draft ISP is now in the consultation stages, prior to final publication in June 2022.

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Electrical transformer
AU Energy Compliance

Victorian Essential Services Commission Annual Report 2020-21 – Summary

On 17 November 2021, the Victorian Essential Services Commission (ESC) released its Annual Report for 2020-21 (the Report). The purpose of the Report is to provide an overview of the previous financial year (ending 20 June 2021), including what they did, how they performed on key goals, and what they plan to do in the future.

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CORONAVIRUS )covid-19)
AU Energy Compliance

AER Calls for Energy Retailers to Focus on Support for Customers in Hardship

stralian Energy Regulator (AER) has called on energy retailers to provide “better” support to customers in hardship. The AER released its Annual Retail Markets Report 2020/21 on 30 November (2021) and noted that despite the fall in retail energy prices for households for the year 20/21, energy debt had risen by 12%, and the amount of the debt of customers entering the various retailer’s hardship programs had risen by 21%.

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AU Energy Compliance

Time to understand “Ring-fencing”

On 3 November 2021, The Australian Energy Regulator (AER)  concluded and published a revision of the Ring-fencing Guideline. Parties are expected to be fully compliant

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Frozen planet Earth climate change concept
AU Energy Compliance

Getting Serious: The Peak Demand Reduction Scheme

The First PDR Initiatives:
– There will be incentives (rebates) for households to purchase and install energy efficient air conditioners (rebates for businesses ACs have been available for some time via other schemes);
– Businesses with EV fleets will be able to export power from their parked vehicles back in to the grid at peak times.

The two initiatives above were cited as examples in the press release on 28 September 2021. There is very little information available as to what other initiatives will be forthcoming.

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Young people encouraging race runners
AU Energy Compliance

An Alternative to Compliance by Coercion

Alternatives to penalties are provided by the behavioural sciences, including command and control and economic instruments such as ‘nudging.’ The underlying concept is to create an environment in which individuals make choices based on nudges towards the desired state. This area is well-developed thanks to the advertising industry and, in the context of compliance, is considered to be ‘at the forefront of regulatory policy and governance.’

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