New NECF derogations for NSW Retailers

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The passing of the NSW Government’s Electricity Infrastructure Investment Bill 2020 dominated headlines at the end of 2020. However, with much less pomp and ceremony, NSW also introduced further derogations to the National Energy Customer Framework (NECF).    

Until October 2020, there existed (in the Electricity Supply Regulations) a prohibition on the remote disconnection of small customers in NSW. However, a combination of new regulations has ended this blanket prohibition while imposing additional compliance obligations on retailers operating in NSW.

The new provisions can be found in the Gas and Electricity (Consumer Safety) Regulation 2018 and the Electricity Supply (General) Regulation 2014 and set out requirements for retailers and metering providers in respect of remote disconnection and reconnection of small customers.

The key changes relevant to retailers are summarised below.

  1. Retailers must remotely reconnect a small customer’s premises within specific timeframes and are liable to pay compensation to customers and fines if they do not meet these timeframes;
  2. Retailers must within 1 business day of the disconnection, give written notice to customers with prescribed information (CQ has provided draft template notices to its clients);
  3. Retailers can only remotely disconnect or reconnect small customers if they have in place an approved safety management and customer procedures plan (that has been submitted to Fair Trading) and adhere to that plan;
  4. Exempt sellers are prohibited from remote disconnection and reconnection of small customers’ premises.

The introduction of a blanket prohibition on exempt sellers is notable, as the previous prohibition did not appear to apply to exemption holders. Any exemption holders taking advantage of that previous omission will now need to change their disconnection practices or seek to supply customers under a retailer authorisation.

While 2020 was a relatively quiet year in respect of energy retail regulatory change at a national level, the abovementioned regulations are the latest in a series of state-based derogations to the NECF which are becoming more prevalent.  

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