The Australian Government is represented on the Ministerial Council on Energy's Retail Policy Working Group
by officials from the Department of Resources, Energy and Tourism.
The Retail Policy Working Group has been tasked by the Ministerial Council on Energy to implement reform under Clause 14 of the Australian Energy Market Agreement in relation to the non-economic regulation of energy distributors and for regulation (excluding price regulation) of energy retailers. This reform encompasses the transfer of current state and territory responsibilities to the National Electricity Law, National Gas Law and other regulatory arrangements.
The main objectives for the creation of a National Energy Customer Framework are to:
- streamline the regulation of energy distribution and retail regulation functions in a national framework
- develop an efficient national retail energy market including appropriate consumer protection.
The National Energy Customer Framework will cover a range of subject matters, including:
- the governance model, including a contractual model that forms the basis of the framework
- supply of energy to retail customers including a regulatory obligation to offer supply to small customers
- provision of customer distribution services to customers
- arrangements between distributors and retailers in provision of energy services to customers
- authorisations
- enhancements to the enforcement and compliance regime.
The legislation to give effect to the National Energy Customer Framework will be introduced to the South Australian Parliament by September 2009, as agreed by the Ministerial Council on Energy at its meeting on 13 December 2007.
Retail energy price regulation
While Clause 14 of the Australian Energy Market Agreement denotes agreement to transfer most regulatory functions to the National Energy Customer Framework, the Agreement provides that retail energy price regulation remains the responsibility of states and territories.
States and territories have agreed, however, to phase out the exercise of retail price regulation for electricity and natural gas where effective retail competition can be demonstrated. To assist states and territories in this regard, the Australian Energy Market Commission is undertaking reviews of:
- jurisdictions with full retail contestability and advising, where effective competition exists
- how that jurisdiction can phase out their retail price regulation.
The AEMC is to conduct the reviews in the following order:
- Victoria in 2007
- South Australia in 2008
- the Australian Capital Territory in 2010, if required
- New South Wales in 2011
For more information on the work of the Retail Policy Working Group, please visit the Ministerial Council on Energy's website.