Decision making in the energy industry
The AER regulates the wholesale electricity market and is responsible for the economic regulation of the electricity transmission and distribution networks in the national electricity market (NEM).
SOUTH AUSTRALIA
ESCOSA - Essential services commission of South Australia
The Electricity Act 1996 (and regulations) and the National Electricity (South Australia) Act 1996 (and the National Electricity Law and National Electricity Rules made under that Act), together with the Essential Services Commission Act 2002, provide the basis for regulation of the electricity supply industry in South Australia.
Regulatory Framework
The above legislation is intended to support competitive markets in the generation and retail sectors of the electricity supply industry, and provide regulatory oversight of the monopoly transmission and distribution network sectors of the industry, while ensuring that consumers are adequately protected in the competitive environment.
The principal functions and powers of the Essential Services Commission in relation to the electricity supply industry include:
- making determinations for the standing contract prices which may be charged by AGL SA Pty Ltd to each small customer that has not moved to a market contract with a retailer of the customer’s choice;
- administering the licensing regime for electricity entities (generation, transmission, distribution, retail and system control), including the issuing and ongoing monitoring of those licences;
- monitoring the performance of licensed entities with regulatory obligations imposed under Acts of Parliament, the licences they hold and industry codes, rules and guidelines issued by the Essential Services Commission and reporting on that performance;
- making industry codes (such as the Energy Retail Code, regulating the behaviour of licensed entities; and
- enforcing compliance with licensees’ regulatory obligations, including undertaking enforcement action as appropriate.
Legislation - Electricity Act
The Electricity Act 1996 is a key part of the framework for the regulation of the electricity supply industry in South Australia. The objects of the Act are to:
- promote efficiency and competition in the electricity supply industry;
- promote the establishment and maintenance of a safe and efficient system of electricity generation, transmission, distribution and safety;
- establish and enforce proper standards of safety, reliability and quality in the electricity supply industry; and
- establish and enforce proper safety and technical standards for electrical installations.
Under section 14 of the Act, the electricity supply industry is declared to be a regulated industry for the purposes of the Essential Services Commission Act 2002, so that the Essential Services Commission can exercise its regulatory powers and functions in respect of that industry including licensing, price regulation and performance monitoring.
VICTORIA
ESC - Essential services commission of Victoria
The Essential Services Commission is the independent regulator of the retail energy industry in Victoria. Its role is to manage licence arrangements for the distribution and sale of gas and electricity in Victoria, and ensure compliance by licensees with conditions in codes and guidelines about service standards and appropriate market arrangements and conduct.
The electricity and gas retail markets are competitive, which means that all customers can choose their energy retailer.
For more visit www.esc.vic.gov.au/
Transfer of regulatory responsibility - energy distribution
From 1 January 2009, responsibility for the regulation of electricity networks (distribution) transfered from the Essential Services Commission (ESC) to the national regulatory body, the Australian Energy Regulator (AER). Responsibility for regulating gas networks transferred to the AER from 1 July 2008.
The AER assumed responsibility for regulation of both economic and non-economic functions of electricity distribution networks (the 'poles and wires') that deliver energy to Victorian households and businesses. Future electricity and gas network price reviews will be conducted by the AER. The AER will administer the existing electricity distribution price decision until 2011 when a new decision is due to be implemented.
The ESC will continue to regulate aspects of the retail energy (electricity and gas) sector - the sector that directly bills customers - in Victoria for, at least, the duration of 2009. From January 2009, retail prices are no longer regulated. Regulation continues to focus on compliance, performance monitoring and reporting and complaints.
Electricity Industry
The electricity industry supplies approximately 2.2 million Victorian customers.
The Victorian electricity industry was disaggregated and the regulatory framework established in 1994. Any person who seeks to engage in the generation, transmission, distribution, supply or sale of electricity requires a licence issued by the Commission, or an exemption issued by the Victorian Government.
Transmission and distribution licensees are required to allow customers and retailers to connect to and use their networks on fair and reasonable terms. They are also required to meet relevant service standards. Licensees must also comply with cross ownership rules to ensure competition is maintained.
A condition of their licences requires electricity distributors and retailers to enter into Use of System Agreements that define the services to be provided to retailers by distributors. Electricity distributors must also publish deemed distribution contracts that set out the quality and reliability of supply standards that they will provide. Distributors’ deemed distribution contracts are published in the Government Gazette.
Price Regulation
The Commission undertakes formal reviews of electricity and gas distribution price controls. The current five-year regulatory period for gas ends on 31 Dec 2007, and for electricity on 31 Dec 2010.
Responsibility for regulating transmission prices transferred to the Australian Competition and Consumer Commission from January 2001 and subsequently to the Australian Energy Regulator (AER). The AER is expected to take responsibility for electricity distribution functions from 2007 and retail functions from 2008.
The Victorian Government has reserve powers to regulate retail prices for electricity customers consuming less than 160MWh/year and gas customers consuming less than 10TJ/year.
Service Standards
Electricity and gas companies are required by their licences to comply with service standards in industry codes and other obligations set out in guidelines regulated by the Commission. The codes include dispute resolution procedures.
The Energy and Water Ombudsman (Victoria) Ltd has power to handle complaints against gas and electricity companies. Electrical and gas safety is regulated by Energy Safe Victoria. The Commission has memoranda of understanding with the Ombudsman and with Energy Safe Victoria.
The Commission monitors the financial, price and service performance of Victoria's retail and distribution businesses and publishes performance reports that monitor trends in performance and stimulate competition by comparison. The Commission publishes maps that show the boundaries of each distributor’s local supply areas.
Retail Competition
Full retail competition became available to electricity customers in January 2001.
A National Electricity Market (NEM) has been established to facilitate the wholesale trading of electricity and to maintain the security of the interstate power system.
NSW
IPART-Independent pricing and regulatory tribunal (NSW)
IPART is an independent body that oversees regulation of the water, gas, electricity and public transport industries in New South Wales. Established by the NSW Government in 1992, IPART's primary purpose was to regulate the maximum prices charged for monopoly services by government utilities and other monopoly businesses. Since then, its responsibilities have increased significantly.
Safety net electricity prices for households and small businesses
Although all customers can choose their retail supplier by taking up a market-based offer, households and most small businesses are able to remain on, or return to, their standard supplier at prices regulated by IPART.
Licences for electricity companies
IPART administers the energy licensing regime on behalf of the Minister for Utilities. All companies that retail or distribute electricity in NSW must have a licence issued by the Minister. IPART advises the Minister in relation to the issuing of new licences and the nature and enforcement of any licence conditions.
Information on the performance of electricity companies
IPART regularly publishes information papers on the performance of electricity companies in NSW. Copies of these papers are available from the electricity performance statistics section of the website.
Electricity network regulation
IPART is no longer the regulator for electricity networks in NSW. The Australian Energy Regulator (regulator) and the Australian Energy Markets Commission (rule maker) are now responsible for network regulation under the national regime.
As a transitional measure, IPART will continue to monitor compliance with the network price determination that is currently in place. This determination will run until 30 June 2009.
For compliance information and completed reviews see the electricity network pricing section of the website. For other information, please contact the Australian Energy Regulator.
Metrology (rules for metering and recording electricity usage)
On 1 January 2007, responsibility for all metrology procedures passed to the National Electricity Market Management Company (NEMMCO).
QLD
QLD- Department of Mines and Energy
Retail competition has been progressively introduced into the Queensland electricity market since 1998. Large electricity users have been able to choose their electricity retailer for some time, and many customers have entered into negotiated contracts with their retailer of choice.
Competition has been introduced in a number of stages, or 'tranches', as follows:
- Tranche 1 - 29 March 1998
Electricity usage of more than 40 gigawatt hours (GWh) per annum, including summation of sites where prior agreement existed - Tranche 2 - 1 October 1998
Electricity usage of more than 4 GWh per annum (large factories, office buildings, shopping centres etc) - Tranche 3 - 1 July 1999
Electricity usage of more than 200 megawatt hours (MWh) per annum (medium retail and commercial outlets) - Tranche 4A - 1 July 2004
Electricity usage of more than 100 MWh per annum (small retail and commercial outlets) - Tranche 4B - 1 July 2007
Full Retail Competition - all customers including households and small business (other than excluded customers or receivers) can choose their electricity retailer
The last stage in this process was the introduction of Full Retail Competition on 1 July 2007, which enabled some 1.8 million household and small business electricity consumers in South East Queensland to choose their electricity retailer for the first time.
With the introduction of Full Retail Competition, a new distinction between "large" and "small" electricity customers has been made.
Large customers are those that consume more than 100 MWh of electricity per annum (i.e. tranches 1 to 4A).
Small customers are those that consume up to 100 MWh of electricity per annum, which includes households and many small businesses (i.e. tranche 4B).
The primary legislation governing Queensland's electricity industry is the Electricity Act 1994 and the Electricity Regulation 2006.
The matters governed by the Electricity Act and Regulation include:
- regulation of the electricity industry and electricity use, including licensing of electricity industry participants and monitoring of licence compliance
- establishment of a framework for retail competition, including ensuring the interests of customers are protected
- making and approval of industry codes, such as the Electricity Industry Code which deals with supply reliability, standard customer contracts of electricity distributors and retailers, and other customer service matters
- approval of electricity prices for non-market customers
- assisting in the settlement of disputes between electricity entities and between electricity entities and public entities
- administration of electricity restrictions and electricity rationing procedures
Many of these matters are statutory functions of the Regulator, who for the purposes of the Electricity Act is the Director-General, Department of Mines and Energy. The Department of Mines and Energy administers many of these matters, including the statutory functions of the Regulator.
Since the commencement of full retail competition (FRC) on 1 July 2007, the Queensland Competition Authority has responsibility for administering some matters under the Electricity Act and, in particular, the Electricity Industry Code.
Also since the commencement of FRC, disputes between small electricity customers and electricity entities are dealt with under the Energy Ombudsman Act 2006.
Electrical safety matters, including licensing of electrical workers and contractors, are dealt with under the Electrical Safety Act 2002 and administered by the Electrical Safety Office within the Department of Industrial Relations.
The Electricity - National Scheme (Queensland) Act 1997 (National Scheme Act) governs Queensland's participation in the National Electricity Market (NEM). This Act also applies the National Electricity Rules to the NEM in Queensland.
The regulatory bodies who undertake economic regulation of the electricity transmission and distribution networks in accordance with the National Scheme Act and the National Electricity Rules are:
- the Queensland Competition Authority, who has responsibility for price regulation of electricity distribution networks.
- the Australian Energy Regulator, who has responsibility for economic regulation (including pricing) of electricity transmission networks.
RENEWABLE ENERGY
OER – Office of Renewable energy regulator
The Office of the Renewable Energy Regulator (ORER) administers the Renewable Energy (Electricity) Act 2000 (the Act), Renewable Energy (Electricity) Charge Act 2000, Renewable Energy (Electricity) (Small-scale Technology Shortfall Charge) Act 2010 and the Renewable Energy (Electricity) Regulations 2001 (the regulations) to increase renewable electricity generation from Australia's renewable energy sources by encouraging the generation of an additional 45,000 GWh of renewable energy per year by 2020.
The Renewable Energy Target (RET) applies nationally, with the majority of electricity retailers and wholesale electricity buyers on liable grids in all States and Territories contributing proportionately to increase Australia's renewable energy sources.
RET operates by imposing a legal liability to support renewable energy electricity generation on, generally, large wholesale purchasers of electricity. An example of a liable party under the legislation would be an electricity retailer purchasing wholesale electricity to meet retail sale obligations to customers (acquisitions of electricity). The liable parties are directly responsible for supporting an increase in the amount of electricity generated from renewable energy sources, which is implemented through the surrender of renewable energy certificates (RECs) in proportion to their acquisitions of electricity.
GOVERNMENT SUPPORT
DPI - Department of primary industries (Vic)
The Department of Primary Industries (DPI) is responsible for agriculture, fisheries, earth resources, energy and forestry in Victoria.
They design and deliver government policies and programs that enable Victoria’s primary and energy industries to sustainably maximise the wealth and wellbeing they generate, by providing essential goods and services, employment, investment and recreational opportunities.
Ombudsman
VIC - Energy and water Ombudsman (EWOV) 1800 500 509
The Energy and Water Ombudsman (Victoria) (EWOV) is an alternative dispute resolution scheme. It is not a government body, but a not-for-profit company. It receives, investigates and resolves customer complaints about electricity, natural gas, bottled gas (LPG) and water companies operating in Victoria.
These companies – our scheme participants – pay an annual fee and also pay for each complaint received against them. That gives them an interest in resolving complaints at their companies before they get to EWOV.
EWOV has a Charter and Constitution. The Charter sets out our jurisdiction, that is, Things EWOV can and can't deal with.
Our services are free to customers, but we will only investigate a complaint after the company has had a reasonable opportunity to resolve it. That usually means at least two contacts with the company.
NSW - Energy and water Ombudsman of NSW (EWON) 1800 246 545
EWON provides an independent way of resolving customer complaints about all electricity and gas suppliers in New South Wales and some water suppliers.
Our service is free for consumers. We aim to keep essential services within reach of everyone.
EWON is an industry-based scheme which is funded by its members. We work towards a fair and reasonable outcome, and our decision-making process is independent. We are not a consumer advocate and we do not represent industry.
QLD - Energy and Water Ombudsman Queensland (EWOQ) 1800 662 837
Energy and Water Ombudsman Queensland (EWOQ) is the primary dispute resolution service for Queensland's energy customers. EWOQ can offer free, fair, independent and confidential dispute resolution services to Queensland's energy customers who have not been able to resolve an issue with their energy supplier. EWOQ can assist consumers with unresolved complaints about high or disputed accounts, connection and disconnection of supply, claims for damage to equipment or property, vegetation management, supply quality, extensions of supply, tarrif rates or charges and general customer service.
Email complaints@ewoq.com.au | Web www.ewoq.com.au | Fax 07 3227 7068 | Mail PO Box 3640, South Brisbane QLD 4101
SA - Energy industry ombudsman of SA (EIOSA) 1800 665 565
EIOSA offers a complaint resolution service. We are not an advocacy service. The Ombudsman scheme acts independently and our fundamental principle is that of fairness to all parties, thus maximising the opportunity for a just, economical, informal and speedy resolution within an environment of privacy and confidentiality. EIOSA is readily accessible to consumers of electricity and gas services regardless of their ethnicity, language skills, physical or mental abilities or geographical location. EIOSA deals with complaints in a fair, just, informal and expeditious manner. We are accessible and our service is free for consumers.