Energy retail markets
In the electricity and gas supply chains, retail refers to the provision of energy services to end-use customers. Energy retail markets provide the interface between retailers and their customers. They allow energy retailers to sell electricity, gas and energy services to residential and business customers.
Retail markets provide:
the framework for retailers to offer energy services to customers
retail competition - allowing consumers to choose between competing retailers
balancing and reconciliation services - for instance, managing the daily allocation of gas usage to retailers to enable the settlement of gas supply contracts
Competitive retail markets with appropriate consumer protections provide a basis for innovation, product choice and competitive pricing.
Elements of energy retail markets - such as those relating to metering, customer transfers (when a customer switches retailer) and balancing and reconciliation - are contained within the National Electricity Rules and the National Gas Rules. Energy-specific consumer protections are contained in the National Energy Retail Law and Rules.
The National Energy Retail Law and Rules governs the sale and supply of electricity and natural gas to retail customers and applies to both the National Electricity Market and to natural gas markets. They cover:
the relationship between retailers and their customers, including obligations to make offers, minimum contract terms and consent requirements for entry into contracts
the relationship between distributors and customers, including standard contract terms
retailer authorisations (licences) to sell electricity and/or natural gas to customers
retailer of last resort arrangements
The framework consists of the National Energy Retail Law, the National Energy Retail Regulations and the National Energy Retail Rules. The objective of this regulatory framework is to promote the National Energy Retail Objective. The National Energy Retail Rules contain more detailed provisions regulating the rights and obligations of retailers and consumers in retailer energy markets.
The framework operates in the Australian Capital Territory, Tasmania, South Australia, New South Wales and Queensland but not in Victoria. Victoria's energy retailer arrangements are largely contained in jurisdictional instruments. However, Victoria has adopted the electricity small customer connections framework in Chapter 5A of the National Electricity Rules.
The framework aims to promote retail competition and empower customers to negotiate energy contracts that suit their needs. It strengthens the position of customers in areas such as hardship, retailer failure, access to digestible market information, and disconnections.
The energy-specific consumer protections under the National Energy Customer Framework are intended to complement and operate alongside consumer protections in the general law. These include protections under the Australian Consumer Law and also state and territory consumer protection laws.
We make rules that facilitate the provision of electricity and gas services to retail customers, including rules relating to:
retail competition - allowing customers to choose between competing retailers and to switch their retailer
energy-specific consumer protections
basic terms and conditions contained in standard and market retail contracts
These rules are contained within the National Electricity Rules, the National Gas Rules and the National Energy Retail Rules.
Regulated prices are set by state-based regulators in some jurisdictions.
When making or amending the National Energy Retail Rules, we must have regard to the National Energy Retail Objective and to whether the proposed changes to the NERR are compatible with the application and development of consumer protections for small customers.
National Energy Retail Objective
The National Energy Retail Objective, as stated in the National Energy Retail Law, is:
to promote efficient investment in, and efficient operation and use of, energy services for the long term interests of consumers of energy with respect to price, quality, safety, reliability and security of supply of energy.