Supporting choices for consumers and businesses to manage their electricity demand

26 November 2015

The Australian Energy Market Commission (AEMC) has made new rules to remove the networks’ effective metering monopoly and give consumers more opportunities to access a wider range of energy services.

AEMC Chairman John Pierce said today, “it is consumers themselves who are in the best position to decide what works for them – and much of our work over the past five years has been about providing opportunities for consumers to make informed choices about the way they use electricity.

“This has never been more important as our energy system is dynamic and change is accelerating, driven in large part by technological advances and innovation.

“The rules released today are another step forward in the Power of Choice reforms which have laid the foundation for consumers to make the choices that suit them best on what services they want and how they manage their bills.

“This rule change allows new competitors to offer metering services, and give people a choice to either retain their existing working meters or to take up new services that advanced meters enable,” Mr Pierce said

“This is the missing link between ongoing electricity reforms and consumer choice,” Mr Pierce said.

“Advances in technology have introduced new ways to better manage our electricity to reduce demand and costs, but the 1950s-style meters installed in most Australian homes and businesses are preventing consumers from accessing 21st century services.”

The information and services available through advanced metering can make it quicker for consumers to switch retailers, allow them to decide how often they want to be billed, and provide them with better information about how they can change their electricity use to save money if they want to.

Consumers would also benefit from more accurate meter reads.

The new rules increase competition between retailers, networks and others to deliver new services via advanced metering to consumers that choose those services, such as actively controlling appliances that use electricity. 

Mr Pierce said the new arrangements are designed to be simple and practical for small consumers.

“Residential and small business consumers will continue to deal with their retailer, will continue to be covered by existing consumer protections, and enjoy access to new services if they want them,” he said.

Mr Pierce said all consumers, regardless of whether they take up new services, could benefit from the changes which support more efficient network investment decisions; lower cost and more accurate automated meter reading; faster remote connections; and faster response to outages.

Under the new rules:

  • Retailers will be responsible for arranging metering services for small customers.
  • Increased competition should encourage cost efficiency and innovation. Any party can set up a business to provide metering services if they meet registration requirements.
  • Additional consumer protections will be introduced:
    • only authorised parties have access to consumers’ electricity data and the services provided through their meter; and
    • allowing consumers to opt out of having an advanced meter if their existing meter works.
  • Minimum service specifications are set for all new and replacement meters for small customers to promote consistency across the National Electricity Market.
  • Customers’ electricity data, and other services available from an advanced meter, can be provided to other service providers such as energy service companies, with the customer’s consent, to enable a range of services which can help consumers understand and manage their electricity use.

Under the new rules, Victorian customers who already have an advanced meter installed are not expected to see any change – but in the future they may see reduced costs and increased options for new metering installations in homes and businesses.

Mr Pierce said the new rules include transitional arrangements for Victoria, where 98 per cent of households and small businesses already have advanced meters installed.

“These arrangements are designed to help consumers reap the benefits of the advanced meters introduced by the Victorian Government under a mandated roll out; and increase competition to reduce costs and increase innovation for customers who will eventually need new meters in the years ahead,” Mr Pierce said.

Power of Choice

We are now three years through a market-wide energy reform program called Power of Choice which is designed to help consumers make clear choices about their energy use through:

  • Better tools – including rule changes like this are about supporting the uptake of products and services that are enabled by advanced meters, such as real-time information on electricity use and greater control of appliances that use electricity. These new tools will help consumers monitor, manage and adjust their energy use.
  • Better information – new rules to make it easier for consumers to get information about their electricity usage from distribution network businesses and retailers. In future, usage data must be provided in an easy-to-understand and timely way.
  • Better price signals – including changes to the principles for distribution network pricing to help get effective price signals to the consumer. From 2017 network businesses will have in place distribution tariffs to better reflect the way individual consumers use so consumers can make more informed decisions about their electricity usage.

 

For further information contact: Media, Prudence Anderson on 0404 821 935 or 02) 8296 7817