Navigating Energy Regulation: Best Practices for Effective Communication

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…
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ACCC Insights on Electricity Bills and Affordability

ACCC Insights on Electricity Bills and Affordability

AU Energy Compliance
The ACCC's latest report on its Inquiry into the National Electricity Market provides unique insights into the electricity bills faced by customers across New South Wales, South Australia, South East Queensland, and Victoria. The ACCC’s findings demonstrate how different energy plans, tariffs and contracts can impact consumers’ bills. The report found electricity prices have increased for most residential and small business customers over the past year, though the full impact of higher wholesale costs experienced in 2022 will continue flowing through to bills over time. According to the ACCC, “Changes in retailers’ costs take time to flow through to retail prices and, even more belatedly, actual billing outcomes experienced by consumers.” Higher wholesale costs are the main driver of price increases. The ACCC noted “wholesale electricity costs are an important…
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Clare Savage Outlines AER’s Consumer Protection Priorities Through Australia’s Energy Transition

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…
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Empowering Change: New Obligations for Energy Retailers to Support Customers Affected by Family Violence

Empowering Change: New Obligations for Energy Retailers to Support Customers Affected by Family Violence

Consultation
As of May 1, 2023, significant changes to the National Energy Retail Rules will come into effect, placing new obligations on energy retailers to better support customers impacted by family violence. This landmark rule change, spearheaded by the Australian Energy Market Commission, aims to protect residential and small business customers from the exploitation of essential services by perpetrators. In response to these amendments, the Australian Energy Regulator (AER) has released an interim guidance note detailing their expectations for retailers' adherence to the new family violence provisions. This article explores the key messages from the AER's guidelines, such as customer identification, safety and risk considerations, staff training, and the necessary steps for compliance. As the energy sector navigates these transformative changes, our team stands ready to provide assistance in reviewing and…
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Consumers: front and centre of energy regulation

Consumers: front and centre of energy regulation

AU Energy Compliance
As the energy market continues to evolve and the ways in which energy is produced, stored, shared and consumed become ever more complex, it is essential that consumers remain front and centre of energy regulation. It is vital that consumers are aware of the changing landscape and their rights and responsibilities when it comes to energy use. The traditional energy market is being transformed as new technologies, such as solar panels and battery storage, become more widely used. This has resulted in a decentralisation of energy production, with consumers able to produce, store and sell energy independently. This decentralisation has led to an increase in the number of small-scale energy producers, such as households and businesses, producing and selling their own energy. While once upon a time consumers were simply…
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AER releases latest Wholesale Markets Quarterly

AER releases latest Wholesale Markets Quarterly

AU Energy Compliance
The Australian Energy Regulator (AER) has published its latest wholesale markets quarterly report that looks at the wholesale gas and electricity markets in the period from July to September 2022.  During the relevant period, gas and electricity prices continued to fluctuate and remained high compared to previous years.  Gas and electricity prices halved in August from record levels in July but have remained consistently high. In June and July, higher winter demand at the time of acute tightening of gas and electricity supply drove wholesale energy prices to record levels.  At the same time international: gas prices climbed sharply and the Iona southern gas storage dropped to record low levels.  That scarcity of gas influenced by domestic gas and electricity prices.  Exacerbating the situation, a number of coal plants experienced…
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The State of the Energy Market 2022 Report

The State of the Energy Market 2022 Report

AU Energy Compliance
The Australian Energy Regulator (AER) has published the 2022 State of the Energy Market Report. The report examines the rise in wholesale energy prices from June 2022. Here we look at some of the findings and explain our views on possible futures. Increased wholesale prices When examining the impact of wholesale pricing on retailers, the AER notes ' A retailer’s level of exposure to the very high electricity and gas prices during 2022, and the extent to which these prices will be passed on to its customers, will depend on different factors. These include the sufficiency of the retailers’ hedging contracts to protect against the high prices, and expectations around the prices it expects to pay in the future for electricity and gas, including for further hedging or risk mitigation…
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2022-2023 Compliance and Enforcement Priorities of the ESC (Victoria)

2022-2023 Compliance and Enforcement Priorities of the ESC (Victoria)

AU Energy Compliance
On 11 July, the Essential Services Commission (ESC) published its energy compliance and enforcement priorities for 2022-23.  The ESC continues to focus on protecting vulnerable customers in the following areas: wrongful disconnection of customersexplicit informed consent (EIC)the payment difficulty frameworkbest offer messagesembedded networks’ fees and chargesdistributors’ guaranteed service level (GSL) compensation paymentsongoing priorities for customers experiencing vulnerability Wrongful disconnection of customers Focus will be on ensuring processes, procedures and rules around disconnections are followed, ensuring disconnections to residential and small businesses are carried out appropriately and only as a last resort. Explicit informed consent (EIC) The ESC will be looking at the area of explicit informed consent to ensure it is correctly obtained (and relevant information provided) prior to entering into certain transactions. They further note: “[W]e have zero tolerance…
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2022-2023 Compliance and Enforcement Priorities of the AER

2022-2023 Compliance and Enforcement Priorities of the AER

AU Energy Compliance
The Australian Energy Regulator (AER) 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. Customers who are facing financial difficulties The AER's focus on vulnerable consumers is understandable with market conditions expected to result in higher energy costs for consumers who are already facing higher costs of living. The AER notes that: We continue to closely monitor data on consumers facing financial difficulties, including debt levels, the number of consumers on payment plans and hardship programs, and the successful completion of those plans and programs. We remain concerned by the average debt per customer upon entry into hardship programs, and the number of…
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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.

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.

AU Energy Compliance
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. In commenting on the hardship provisions, Justice Colvin noted that “delay in registration deprives a customer of these important protections which obviously may have consequences that jeopardise, potentially, the life of the customer.”  The penalty that was imposed was based on the civil penalty regime at…
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