AER Archives

Nov122023 by Connor JamesNo Comments

Preparing to Apply for a Retailer Authorisation: A Comprehensive Guide

The Australian Energy Regulator (AER) oversees the authorisation process for energy retailers in Australia. If you're considering joining this market, it's crucial to understand the AER's guidelines and requirements. This article will outline the preparatory steps your business needs to take before applying for a retailer authorisation. If you would like to know if your business is ready to apply, please contact us. What is a Retailer Authorisation? A retailer authorisation allows businesses to sell energy (gas or electricity) under the National Energy Retail Law (Retail Law). The AER provides a specific guideline document called "AER Retailer Authorisation Guideline" to guide businesses in this process. The guideline details the application process, entry criteria, obligations, and procedures for authorisation amendments, revocation, surrender, and transfer. Preparing for a Retailer Authorisation Before applying…

Nov82023 by Connor JamesNo Comments

The State of the Energy Market 2023: Observations and Insights

AU Energy Compliance

The energy market is an ever-evolving landscape, dictated by a complex interplay of market forces, consumer behaviours, and regulatory interventions. The 'State of the Energy Market 2023' report, published by the Australian Energy Regulator (AER), provides a comprehensive evaluation of the market's current state, offering valuable insights into the retail energy markets, market regulations, energy affordability, and the role of the energy retailer. The Role of Energy Retailers Energy retailers sit at the crucial intersection of the energy supply chain, linking energy generation, distribution, and end consumers. They purchase electricity and gas either directly from suppliers or through wholesale markets and sell it to residential and small business customers. As noted in the 'State of the Energy Market 2023' report, "Retailers are exposed to financial risk through spot price volatility…

Oct262023 by Connor JamesNo Comments

Navigating Energy Regulation: Best Practices for Effective Communication

AU Energy Compliance, NT Energy Compliance

Energy retailers operate in a dynamic and highly regulated environment so dealing with energy regulators is an inevitable aspect of this business. To maintain a healthy and compliant relationship with energy regulators, there are some key principles to keep in mind. Be Succinct When communicating with energy regulators, less can often be more. Energy retailers should strive for succinctness because providing excessive information increases the risk of regulators raising further questions on other areas of the business not previously in the spotlight. By offering precisely what's requested and nothing more, retailers minimise the chances of inadvertently highlighting furtherissues. When responding to requests for information, provide the regulators with precisely what they have asked for and ensure your response is directly relevant to their inquiry. Address any specific questions asked without…

Oct262023 by Connor JamesNo Comments

Understanding Energy Retail Contracts and Retailer Obligations

AU Energy Compliance

Types of Energy Retail Contracts Energy retail contracts are agreements between an energy retailer and a customer outlining the terms and conditions for the sale and supply of energy. There are primarily two types of contracts: Standard Retail Contracts: These contracts are set out by law and offer basic consumer protections. The terms and conditions, including prices, are regulated and cannot be altered by the energy retailer. Market Retail Contracts: These contracts are more flexible and may offer discounted rates, renewable energy options, and other incentives. The terms and conditions, including prices, are set by the energy retailer and may vary. Obligations of Energy Retailers Energy retailers operating in NSW, QLD, ACT, SA, and TAS have a range of obligations under the National Energy Retail Rules (NERR) the Law and…

Sep302023 by Connor JamesNo Comments

The Electricity Invoice Rubik’s Cube

AU Energy Compliance, Consumer

One of the few ways that an energy retailer can potentially distinguish themselves is by the way in which they present their electricity invoices. It is a challenging design problem: you have a number of constraints in the regulatory framework and with simple space on the page, you have readers with varying levels of energy understanding, literacy, disabilities, and language proficiency, and you have a lot of information you want to convey. In those states that have adopted the National Energy Customer Framework (NECF), retailers must now comply with the Better Bills Guideline. In Victoria, retailers have more discretion. The space that is available on an energy invoice is limited, it has always been challenging for retailers to present a simple invoice that not only explains what is payable but…

Sep212023 by Connor JamesNo Comments

Final report published by the AEMC on Consumer Energy Resources Technical Standards

AU Energy Compliance

The Australian Energy Market Commission has released its final report for the Review into Consumer Energy Resources Technical Standards, calling for the development of a national regulatory framework to improve compliance with technical standards for rooftop solar and other distributed energy resources. The review found "significant non-compliance" with existing rooftop solar inverter standards, with only 37% of new rooftop solar connections correctly configured according to the standards in the first quarter of 2022. The commission warned that non-compliance poses "immediate concerns and undermines confidence in the effective implementation of any future" standards. To address these issues, the commission recommended that "energy ministers lead the development of a national regulatory framework for consumer energy resources technical standards." The framework should consider several options, including expanding the role of the Australian Energy…

Jul262023 by Connor JamesNo Comments

AER Draft Guidance including emission reductions in energy objectives

AU Energy Compliance

The Australian Energy Regulator (AER) has released draft guidance on how it proposes to implement the amended National Electricity Objective (NEO) and National Gas Objective (NGO) to include consideration of emission reductions. The amendments to the NEO, NGO and National Energy Retail Objective are expected to be passed by the South Australian parliament in September 2023. The AER “supports clarity around the changes to the national energy objectives to refer to government emission reduction targets and their application to AER decisions,” the guidance states. “As the independent regulator, the national energy objectives guide our work to promote the long-term interests of consumers with respect to achieving emission reduction targets, alongside our existing considerations including price, quality, safety and reliability of energy supply.” The guidance covers two main areas: The matters…

Jul262023 by Connor JamesNo Comments

AER Releases Annual Compliance and Enforcement Report: Focus on Supporting Vulnerable Customers and Efficient Energy Markets

AU Energy Compliance

The Australian Energy Regulator (AER) recently released its Annual Compliance and Enforcement Report for 2022–23, outlining its activities over the past year to monitor and enforce compliance with Australia’s national energy laws and rules. A key focus has been on supporting vulnerable customers, including those experiencing financial hardship. The AER has also acted to support the efficient operation of competitive energy markets through monitoring compliance of generators, gas pipelines and retailers. In the report the AER note that “Compliance with national energy laws gives consumers and energy market participants confidence that energy markets are working effectively and in their long-term interests.” The AER set five compliance priorities for 2022–23, focusing on consumers, wholesale electricity and gas markets. Supporting Consumers Experiencing Vulnerability A top priority was effective identification of residential customers…

Jun272023 by Connor JamesNo Comments

Key points from Executive Board Member Geoff Summerhayes’ speech to the Financial Services Assurance Forum- Lessons for Energy Sellers

AU Energy Compliance

Cyber threats are accelerating and evolving rapidly. The COVID-19 pandemic has led to a surge in online activity and remote working, providing more opportunities for cyber criminals to attack. Boards and internal audit functions often lack understanding and expertise in cyber security, leaving organisations vulnerable. To address this, APRA has released a new Cyber Security Strategy for 2020 to 2024. It aims to: Establish a baseline of cyber controls including information sharing and incident response. The goal is to address basic cyber hygiene issues, foster collaboration, and ensure organisations are prepared for breaches. Enable boards and executives to properly oversee cyber risks. APRA will provide guidance and increase scrutiny of cyber governance. Boards need to understand cyber risks and take action. Internal audit functions also need to strengthen their cyber…

Jun252023 by Connor JamesNo Comments

Clare Savage Outlines AER’s Consumer Protection Priorities Through Australia’s Energy Transition

AU Energy Compliance

Australian Energy Regulator (AER) Chair Clare Savage recently outlined the regulator’s consumer protection priorities for 2023-2024 during her address at the 2023 Australian Energy Week conference. Savage acknowledged the challenging times facing the energy sector with the twin themes of the accelerating energy transition and increasing cost of living pressures affecting consumers. Savage emphasised the AER’s role in protecting consumers through compliance and enforcement actions against energy companies that fail to meet their obligations. Savage noted that maximum penalties for breaching energy laws have increased substantially, with the largest penalty imposed in 2022 totalling $17 million compared to $1.5 million previously. Over the past two years, total AER issued penalties have amounted to over $39 million, a significant increase from just $3.5 million over the previous 14 years. According to…