The AEMC has published a draft report recommending the introduction of a regulatory sandbox toolkit to make it easier for businesses to develop and trial innovative energy technologies and business models.  

A regulatory sandbox is a framework within which participants can trial innovative concepts in the market under relaxed regulatory requirements at a smaller scale, on a time-limited basis and with appropriate safeguards in place. 

Innovation in the energy sector can lead to better services and lower costs for consumers.  It is important that the regulatory framework supports emerging technologies and business models that have the potential to deliver these benefits to consumers.  

The AEMC has proposed three new tools to facilitate proof-of-concept trials:

  • an innovation inquiry service, to provide guidance and feedback and help businesses get trials up and running quickly where they are feasible under current laws and regulation 
  • a new regulatory waiver power for the Australian Energy Regulator (AER) so they can temporarily exempt trials from existing rules where this is creating a barrier
  • a new AEMC trial rule change process that can quickly and temporarily change existing rules or temporarily introduce a new rule of limited application to allow a trial to go ahead.

These three new tools aim to give innovators the ability to trail new approaches that could benefit consumers while still providing appropriate protections for consumers.  

Stakeholders are encouraged to provide feedback on the recommend approach set out in this draft report. Submissions are due by 8 August 2019. 

The AEMC will be holding a stakeholder workshop on 26 July 2019 in Sydney. The workshop will also be webcast. Register to attend the forum here.

The AEMC will provide its final recommendations along with detailed advice on law and rule changes to implement these recommendations in its final report in September 2019.
Media: Prudence Anderson, 0404 821 935 or (02) 8296 7817


This draft report follows a request from the Council of Australian Governments (COAG) Energy Council Senior Committee of Officials and is part of the AEMC’s annual Electricity network economic regulatory framework review. It builds on the findings of our March 2019 Interim advice, 2018 Electricity network economic regulatory framework review, a recommendation of the Finkel review and previous work done by state, territory and commonwealth officials to consider the case for introducing regulatory sandbox arrangements.

The Commission received a strong response to our consultation paper published on 20 December 2018, with most stakeholders supporting the establishment of regulatory sandbox arrangements. Submissions can be viewed on the project page