Rule Change: Open

Overview

This rule change request from the Australian Energy Market Operator aims to speed up the process for customers to transfer to a new electricity retailer.  
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This rule change request from the Australian Energy Market Operator aims to speed up the process for customers to transfer to a new electricity retailer.  

Draft determination

On 26 September 2019 the AEMC released a draft determination for a more preferable rule for consultation. 

The draft determination and draft rule are generally consistent with the intent of AEMO’s proposal, but vary in how it is achieved. 

The draft rule amends the NER to facilitate:

  • AEMO to move the provisions from the Market Settlement and Transfer Solution (MSATS) Procedures to the Meter Churn Procedures, where it more appropriately fits.
  • AEMO's customer transfer high level design and to remove any ambiguity between other NER provisions regarding metering coordinator appointments by the financially responsible market participant.

The draft rule also amends the model terms and conditions for standard retail contracts in the NERR to clarify that a customer can transfer to the same retailer’s market retail contract, or to another retailers standard or market retail contract .

In regard to issues raised by AEMO, the Commission decided to not make any amendments to:

  • Clauses in the NERR regarding meter read types and use of metering data.
  • Clauses in the NERR regarding the overcharging and undercharging processes.
  • The model terms and conditions for standard retail contracts to facilitate transfers on estimate meter reads.
  • Prohibit retailers from containing provisions in their market retail contracts that only allowed final bills, and therefore transfers, on actual meter reads.

The Commission concluded that no changes are required to these clauses to facilitate AEMO's implementation of the High Level Design and that the current Rules provide a sufficient level of consumer protection. Instead, where there is currently doubt regarding the interpretation of these clauses, the Commission has provided clarifications within the draft determination.

The Commission has also chosen to not adopt AEMO's proposal to remove the ability of retailers to recover any undercharged amount as a result of a customer transfer. The undercharge and overcharge provisions act together provide rights to customers and retailers to recover revenue when a bill was inaccurate. Removing the undercharge provision would increase risks for retailers, especially with the likelihood of a greater number of transfers occurring on the basis of estimated reads. 

Submissions on the draft determination and draft rule were due by 7 November 2019.

Background 

On 3 December 2018, the AEMC and AEMO provided joint advice to the Council of Australian Governments (COAG) Energy Council in response to a request from the Senior Council of Officials. It addressed improvements to the customer transfer process in the NEM, taking into account the related recommendations 8 and 9 of the Australian Competition and Consumer Commission (ACCC) Retail Electricity Pricing Inquiry Final Report (REPI).

In developing the advice AEMO and the AEMC highlighted that the changes are largely within AEMO’s remit through procedure changes. The only changes required to the rules are clarifications and checks that consumer protections are adequate for a circumstance where more customers may change retailers based on self-reads and estimated reads. Given the nature of the rule change it is possible to progress them simultaneously.

On 4 July 2019, the AEMC published a consultation paper seeking views on AEMO’s rule change request.

Stakeholder submissions were due on 1 August 2019. The Commission received 22 submissions and can be found below.

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Documentation