Energy companies must play by the rules: AER

Providing Australians with an essential service like energy is an enormous responsibility that requires close accountability.

Launching the Australian Energy Regulator’s (AER) annual compliance and enforcement priorities and policy, AER Chair Paula Conboy said energy companies had to play by the rules set out in the national energy laws or face the consequences:

“The need for consumer trust and confidence has never been more important than it is now. We expect energy companies to do the right thing by following the energy laws and for the most part they do. 

“However, we think there is still room for improvement and that companies which fail to comply should be held to account.”

The protection of vulnerable or disadvantaged people – especially those facing financial hardship or relying on life support protections – is a key compliance priority for the AER in 2019/20.

“It is those in our community who are most vulnerable that suffer the greatest penalty when companies break the rules or get it wrong. We welcome new hardship rules designed to help protect people struggling to pay their bills, and we’ll be coming down hard on companies that might breach them.

“Customers who rely on life support equipment are among the most vulnerable there are. We will enforce additional new protections for those people and their families, taking effect from 1 February 2019 and we are actively monitoring industry compliance,” said Ms Conboy.

Another major priority for the year is the provision of accurate and timely information to the Australian Energy Market Operator, which is critical to ensuring power system security and the effective operation of wholesale energy markets. The AER will focus on ensuring that businesses comply with their obligations with respect to data quality and timeliness.

Ms Conboy said that stronger powers and penalties were on the way to support AER’s compliance and enforcement role and couldn’t come soon enough.

“We regulate big companies that operate in the tens and hundreds of millions of dollars. Increased powers and penalties provides an increased incentive for behaviour change,” she said.

Ms Conboy said that a new AER Compliance and Enforcement policy set out the factors it will consider in deciding whether to take enforcement action and the nature of that action

The AER has a range of enforcement options, including undertakings, infringement notices and litigation, which will be used to achieve the optimal results for markets and consumers. ”

Additional AER compliance and enforcement priorities for the year include:

  • supporting the transition to metering contestability to ensure consumer and market benefits are delivered
  • the implementation of capacity trading markets under the East Coast Gas Reforms and improving gas market transparency through the strengthening of the Gas Bulletin Board

About the AER

The AER works to make all Australian energy consumers better off, now and in the future. 

  • We regulate electricity networks and covered gas pipelines, in all jurisdictions except Western Australia. We set the amount of revenue that network businesses can recover from customers for using these networks.
  • We enforce the laws for the National Electricity Market and spot gas markets in southern and eastern Australia. We monitor and report on the conduct of energy businesses and the effectiveness of competition.
  • We protect the interests of household and small business consumers by enforcing the Retail Law. Our retail energy market functions cover New South Wales, South Australia, Tasmania, the ACT and Queensland. We do not set the prices consumers pay.

We drive effective competition where it is feasible and provide effective regulation where it is not. We equip consumers to participate effectively, including through our Energy Made Easy website, and protect those who are unable to safeguard their own interests. We use our expertise to inform debate about Australia’s energy future.

Issued date: 
16 July 2019
AER reference: 
NR 13/19
AER Media 0466 409 921