Review of Queensland Energy Legislation

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In mid-2018, the Queensland Government carried out an initial consultation on a Review of Queensland Energy Legislation (the Review). The Review covers the operation of the Electricity Act 1994, the Gas Supply Act 2003, the Energy and Water Ombudsman Act 2006 and the Liquid Fuel Supply Act 1984. Two further documents have now been released for consultation as part of the Review. The first options paper summarises ‘regulatory impact statements’ for a range of proposed changes while a second paper goes into more significant detail with respect to those changes.

In this article we summarise the areas of proposed change, focusing on those areas that will impact on authorised retailers and/or embedded networks in Queensland.

By Dr Drew Donnelly, Compliance Quarter

Rationale for the Review

The overarching motivation for the Review is to deal with the duplication and perceived lack of alignment between Queensland state energy laws and regulations and laws and regulations that are applied national/across states and territories such as the National Electricity Law. It also considers whether the existing laws are well-calibrated to deal with new forms of energy generation and distribution. The Review does not consider the operation of the National Energy Retail Law/National Energy Retail Rules in Queensland as they are the subject of a separate review.

General Changes

The changes described below are general recommendations and options for change:

  • Update of the purpose sections of Queensland energy laws to align with the purposes of national laws;
  • Removal of duplication in demand management and energy efficiency in state/territory and national laws, while maintaining demand management reporting for standalone power systems (e.g. micro-grids);
  • Interaction between state and national laws. It is recommended that definitions across both be made more consistent. In addition, work will be carried out to support the operation of the Distributed Energy Resource (DER) Register at the state level;
  • Licensing. It is proposed that there be changes to remove duplication to authorisation and exemption processes. Standalone power systems would no longer have a blanket exemption from distribution authorisation. It is recommended that electricity and gas distribution licensing be preserved, but further aligned with national arrangements;
  • Technical requirements. Currently there are restrictions on distributors providing services via stand-alone power systems (e,g, microgrids). There may also be a need for new technical rules to help deal with the sensitivity of isolated networks to solar installations as well as clearer rules about battery installations;
  • Modernise the regional feed-in tariff, including allowing for exporting form a battery systems.
  • Ombudsman Framework. It is recommended that the Energy and Water Ombudsman Queensland (EWOQ) be retained as a statutory entity, but that it be given greater flexibility. The Ombudsman would have increased flexibility to adjust scope of complaints and cost recovery arrangements, as well as stronger review powers.
  • Complaints processes. Currently complaints by public entities are overseen by both the Department of Natural Resources, Mines and Energy (DNRME) and the Queensland Competition Authority (QCA). It is recommended that this role be assigned entirely to the QCA.
  • Modernising emergency powers. Changes to the Electricity Act 1994 are recommended to replace the rationing order provisions with powers for Minister to declare an electricity supply emergency and make emergency directions. The Electricity Act 1994 and the Liquid Fuel Supply Act 1984 would be amended to include information request powers to support emergency management planning.
  • Offences and Enforcement. Currently enforcement powers are split between ‘the Regulator’(Chief Executive of DNRME) and the Queensland Competition Authority (QCA). Feedback is sought on whether the administrative and enforcement functions should be completely separated.

Changes with specific impact on retailers, embedded networks or exempt sellers

The changes proposed below are of particular importance to authorised energy retailers, exempt sellers or anyone who owns, operates, controls or provides services to embedded electricity or gas networks.

  • Powers of entry/access. It is proposed that there be new/enhanced rights of access in embedded networks to allow works for operation, maintenance and repair to support system safety and reliability;
  • Access to Ombudsman. Following other National Energy Customer Framework jurisdictions, it is recommended that small customers in embedded networks have a right of complaint to EWOQ. It is also recommended there be no annual membership fee for ‘exempt sellers’. It is proposed, rather, that that fees for access to the ombudsman be based on a sliding scale that relates to the number of customers the embedded network ‘exempt seller’ has. This option is seen as going partway to covering the costs associated with an Ombudsman investigation while acknowledging the exempt seller’s ability to pay. It is also being recommended that the fee scheme be deferred for 12 months;
  • Customer protections. At the moment there are restrictions on accessing the energy concessions scheme as concessions are administered by retailers. It is proposed that this be altered so that all customers of exempt sellers have direct access to concessions (including those in standalone power systems/microgrids who currently have no access to the scheme).

For more information see https://www.dnrme.qld.gov.au/energy/initiatives/review-energy-legislation. If you wish to make a submission, consultation closes on 31 January 2020.

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