Market Review: Completed
The AEMC has published a final report that proposes a package of law and rule changes to update the regulatory frameworks for embedded networks. Once implemented, the proposed framework will result in better protections and access to more competitive retail offers for consumers in embedded networks.
Embedded networks are private electricity distribution networks that serve multiple customers and are connected to another distribution or transmission system in the national grid through a parent connection point.
Prompted by the significant uptake of embedded networks in recent years and concerns in relation to poor consumer experiences, the Commission assessed the current regulatory arrangements through its 2017 Review of regulatory arrangements for embedded networks. We identified a number of issues in relation to accessing retail market competition, consumer protections and monitoring and enforcement regimes. To address these issues, the AEMC recommended new regulatory arrangements, as outlined in the 2017 review’s Final report.
Consistent with the 2017 review, the proposed package of law and rule changes will elevate embedded networks into the national framework. The registration and of embedded network service providers and authorisation of off-market retailers will benefit consumers by allowing obligations relating to consumer protections and retail market competition to apply directly to embedded networks and be more readily enforced.
The final report also includes a plan to transition certain legacy embedded networks to the new arrangements.
The proposed framework will be implemented when the COAG Energy Council has redrafted electricity and energy retail laws based on the AEMC's proposed law change descriptions, and submitted these to the South Australian Parliament to make, and the South Australian Minister has made the proposed rule changes. The Commission anticipates this could occur by mid-2020.
The Commission also undertook a review of the regulatory framework for stand-alone power systems, which will consider a number of related issues, particularly with regards to consumer protections.
Both reviews are part of the AEMC’s consumer action plan to give consumers more choices about energy products and services; more control over energy bills; and stronger protections.