Embedded Network Operators can now join EWOQ

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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’).

The changes affect any individual or company that runs an embedded network in Queensland and are an ‘exempt seller’.

The New Sections:

Section 4 of the EWO-AR introduces a new section, (2A), in to the Act which prescribes certain entities as energy entities for the purpose of the Regs.

2A        Prescribed energy entities—Act, s 7

(1) For section 7(2) of the Act, the following entities are prescribed to be energy entities—

(a)a retailer whose retailer authorisation authorises the retailer to sell electricity by on-supplying it to residential customers;

(b) an exempt seller, if any of the following exemptions under part 5, division 6 of the NERL (Qld) are in force in relation to the exempt seller—

(i)an individual exemption under which the exempt seller sells electricity by on-supplying it to residential customers;

(ii)an exemption included in class D2, D6, R2, R3 or R4 described in the AER Exempt Selling Guidelines applying to retail exemptions;

(c) a person who holds an exemption under the National Electricity (          Queensland) Law, section 12 or 13, if the exemption is included in class ND2, ND6, NR2, NR3 or NR4 described in the network exemption guideline.

(2) In this section—

AER Exempt Selling Guidelines see the NERL (Qld), section 118(1).

NER see the NERL (Qld), section 2(1).

network exemption guideline means the ‘Electricity network service provider – registration exemption guideline’ made under the NER, clause 2.5.1(e).

residential customer see the NERL (Qld), section 2(1).

retailer authorisation see the NERL (Qld), section 2(1).

Section 5 of the EWO-AR introduces another new section, (3A), into the Act which prescribes amounts for a participation fee for ‘prescribed energy entities’.

3A Prescribed amount for participation fee for, and when participation fee is payable by, prescribed energy entities—Act, ss 66 and 67

(1) For section 67(1)(g) of the Act, the following amount is prescribed—

(a)for a prescribed energy entity mentioned in section 2A(1)(a)—

(i) if the prescribed energy entity holds 1 retailer authorisation—$5,000; or

(ii) if the prescribed energy entity holds more than 1 retailer authorisation—$10,000;

(b) for a prescribed energy entity mentioned in section 2A(1)(b) or (c)—

(i) if the prescribed energy entity sells electricity to not more than 2,000 relevant energy customers—nil; or

(ii) if the prescribed energy entity sells electricity to more than 2,000 relevant energy customers— $5,000.

(2) For section 66(5)(a) of the Act, the energy and water ombudsman must give a prescribed energy entity an invoice for the amount of the participation fee.

(3) For section 66(5)(b) of the Act, the period is 14 days after the prescribed energy entity receives the invoice.

The Effect of the New Provisions:

If you’re an exempt seller with 2,000 or less customers, you’re automatically deemed an Energy and Water Ombudsman of Queensland (EWOQ) scheme participant. If you’re an exempt seller with more than 2,000 customers, you’re required to join the scheme and pay a membership fee.

If you are a body corporate and your body corporate is legally named as the exempt seller, it must become a member of EWOQ, even if you have a billing agent, strata manager or embedded network manager acting on your behalf.

However, membership can be managed administratively by your billing agent, embedded network manager or strata manager. This includes applying for membership and managing complaints on your behalf. You’ll need to provide EWOQ with a completed Exempt Seller Authority to Act form signed by both the body corporate and the agent in order to do this.

If you manage an embedded network on behalf of an exempt seller you are not required to become an EWOQ member. However, you can act on their behalf, including applying for membership and managing complaints. To do this, you’ll need to provide EWOQ with a completed Exempt Seller Authority to Act form signed by both the exempt seller and yourself.

A customer who has an issue with their electricity is to contact their embedded network operator. If the issue isn’t fixed or the customer is unhappy with the outcome, they can contact the EWOQ in relation to

  • high bills and disputed accounts;
  • credit issues, including default listings;
  • access to payment plans, rebates and concessions;
  • disconnection of supply;
  • connection issues;
  • poor customer service;
  • body corporate decisions about your embedded network.

What is the Cost and When do we Have to Pay?

If the (prescribed energy) entity has 1 retailer authorisation they will be required to pay $5000 or $10,000 if the entity holds more than 1 retailer authorisation. If you are an entity with less than 2,000 customers the fee is nil (even though your entity is under the scheme. As stated above, an entity with less than 2,000 customers is ‘deemed’ a scheme participant and is not required to pay a participation fee.

An entity with more than 2,000 customers will be required to participate in the scheme. The cost for such an entity is $5,000 or $10,000 if the entity has more than 1 retailer licence.

The participation fee will be issued by EWOQ by way of invoice and payment is due and payable within 14 days of the entity receiving the invoice.

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