Regulatory sandboxing

Regulatory sandboxing aims to help energy innovators and start-ups navigate complex regulatory frameworks and enable the trial of new products and services that will deliver greater choice and cheaper energy options for consumers. The AER delivers regulatory sandboxing alongside, the Australian Energy Market Commission (AEMC), the Australian Energy Market Operator (AEMO) and Victoria’s Essential Services Commission (ESCV).

There are three components to regulatory sandboxing:

  1. An Innovation Enquiry Service that provides innovators with guidance from the AER and other market bodies on how their new technologies or business models can be delivered under the current regulatory framework. The website will provide interactive tools and case studies to assist innovators, as well as allowing them to submit an enquiry form to seek informal feedback specific to their project.
  2. A trial waiver that allows the AER to grant a time limited trial waiver for eligible trial projects, exempting an innovator from having to comply with specified rules for a period of time to allow a trial to proceed. Innovators will be required to submit a form via the sandboxing website explaining the details of their project and how it meets the necessary criteria. Trial waivers will be subject to a number of conditions, including consumer protection measures, reporting requirements and other obligations that may be specific to the trial.
  3. A trial rule change process that allows the AEMC to temporarily change existing rules or introduce a new rule to allow a trial to proceed. Trial rule change requests may be submitted via the sandboxing website and will be forwarded to the AEMC to be assessed.

The AER is currently in the process of developing its functions under regulatory sandboxing. On 10 November 2021, we released an issues paper seeking feedback on our proposed approach to delivering regulatory sandboxing. Submissions closed on 28 January 2022 and are available to view. On 19 April, we released our positions paper finalising our approach to delivering regulatory sandboxing.