For some time now, we have been expecting legislative amendments in Queensland that implement a “retailer of choice” regime for customers in embedded electricity networks (known as exempt customers).
- the Electricity Act 1994 (Qld) by deleting section 23(2) of that Act. This simple change removes the legislative barrier allowing “retailer of choice” in Queensland; and
- the Energy and Water Ombudsman Act 2006 (Qld) to allow customers who have exercised their choice to purchase electricity from a retailer access to the Queensland Energy and Water Ombudsman. This does not apply to business customers purchasing more than 160MWh a year from a retailer.
The above changes will commence on 1 December 2017, to align with the changes to the National Electricity Rules set out in the National Electricity Amendment (Embedded Networks) Rule 2015 (Rule Change).
It is important for every on-supplier in Queensland to consider the impact of the Rule Change on their current on-selling activities.
The two key changes are:
- Retailer of Choice: From 1 December 2017 certain categories of customers within an embedded network may choose to purchase electricity from a retailer of their choice. Condition 13 of the AER (Retail) Exempt Selling Guideline states that where “retailer of choice” is available to an exempt customer, the on-supplier must not do anything to interfere with the exempt customer exercising this choice. For example the on-supplier must not require an exempt customer to pay for lost capital, income or profit. We can provide further advice on whether this applies to you.
- Appointment of Embedded Network Manager: The Rule Change creates the role of an embedded network manager. This person must be accredited and registered by AEMO. One function of the embedded network manager is to manage the metering systems to allow customers to access retail competition. Unless an exemption applies, an on-supplier is required to appoint the embedded network manager by 1 December 2017 (for existing networks) or otherwise immediately on the network commencing operation. The Electricity Network Service Provider – Registration Exemption Guideline contains strict provisions regarding the recovery of the costs incurred in appointing an embedded network manager.
With these changes likely to come into effect on 1 December 2017, now is the perfect time to review your current on-supply arrangements to ensure you are compliant with the conditions that apply to your on-selling activities and are prepared for the changes to come.