On 28 November 2017 the AEMC published a final report on its review of regulatory arrangements for embedded networks.
The final report finds that the current regulatory arrangements for embedded networks are no longer fit for purpose, given the growth in the number of embedded networks and businesses providing services in this sector. The Commission made final recommendations that would provide embedded network customers with appropriate levels of access to retail competition and consumer protections.
To address the issues that have arisen in relation to accessing retail market competition, consumer protections and monitoring and enforcement regimes the AEMC recommended new regulatory arrangements for legacy and new embedded networks.
Implementing the recommended regulatory framework will require an inter-dependent package of law and rule changes to:
The AEMC will start work on developing detailed advice on implementing the proposed framework set out in this final report in 2018, including preparing and consulting on a description of the law changes and draft rule change requests.
A report from MinterEllison, Review of regulatory arrangements for embedded networks - implementation of recommendations in Draft Report is published on this project page to accompany this review. The MinterEllison report provides further detail on how the AEMC's recommended framework can be implemented through the national energy
This review is being held under terms of reference from the COAG Energy Council received in December 2016. The request to the AEMC to undertake this review arose out of the Embedded networks rule change, completed in December 2015.
A number of substantial retail market issues were raised during the AEMC’s work on the rule change. Due to the limited scope of the rule change request, the Commission did not have the power to make changes to the NERR. The Commission also considered that further analysis and consultation was required on the retail market issues raised by embedded networks, including potential NERL changes.
In the Final Rule Determination, the AEMC recommended that the COAG Energy Council request the Commission to undertake a review of the NERL and NERR to identify and assess the issues regarding the arrangements for embedded network customers. The Commission also recommended that the COAG Energy Council consider whether this review should consider broader embedded network issues.