The Australian Energy Regulator (AER) has granted a ring-fencing waiver to CitiPower, Powercor and United Energy (collectively, CPU) to enable CPU to conduct a kerbside electric vehicle (EV) charging trial until mid-2031, with strict conditions to safeguard market competition and maximise trial learnings.
‘Ring-fencing’ regulations exist to prevent monopoly network service providers from using their market power in contestable parts of the energy system.
The waiver will allow CPU to install up to 100 EV chargers (which must include at least 5% vehicle-to-grid chargers) to test, analyse and publicly report on how kerbside EV charging can be used to manage local network constraints, improve voltage stability, and shift demand away from peak periods.
AER Chair Clare Savage said that in deciding to grant the waiver the AER has carefully considered stakeholder views and weighed the potential benefits against the risks.
“There has been significant interest in this trial waiver application and a wide range of views have been provided by a broad spectrum of stakeholders during consultation.
“On balance, we consider there are a number of potential benefits for all Victorian electricity consumers from the trial. We have therefore decided to grant a limited-scope, time-bound waiver to CPU with strict conditions designed to protect competition.
“As demand for energy grows, it is beneficial to explore how kerbside electric vehicle charging infrastructure can be used to manage electricity networks more efficiently. This could help to reduce the need for new investment in networks that is paid for by all consumers,” Ms Savage said.
CPU will fund this $1.2 million trial and there will be no bill impacts on customers in the CPU networks. It will own and maintain the chargers (mounted on their kerbside power poles) over the course of the trial but will lease out commercial access to the chargers to a range of service providers who will operate the chargers, including setting customer charging rates.
The AER has imposed 9 conditions on this waiver. These conditions impose requirements on the design of the trial, obligations to ensure a level playing field for third parties (including charging itself the same pole access fees), and require transparent reporting both publicly and to the AER.
At the end of the trial, CPU must choose to either uninstall the chargers, offer all EV chargers and the sites to contestable providers to continue operation at the sites, or apply to the AER for an additional ring-fencing waiver.
CPU proposes to test demand management via its chargers, including customer response to price signals and via direct modulation of energy supply to the chargers. This testing could support efficient functioning of the electricity system if it leads to higher usage during minimum demand events, reduced usage during critical peak events, and improves CPU’s ability to manage the network (e.g. voltage management).
Improving the management of network constraints could also help expand the future set of suitable poles for kerbside charging, supporting the efficient operation and delivery of essential distribution network infrastructure.
“As the volume and integration of consumer energy resources, such as electric vehicles, in our electricity system evolves, we are continuing to call for innovative ideas from network businesses to boost network utilisation.
“The AER can consider innovative ideas through our regulatory sandboxing and trial waiver functions.
“All waiver proposals are considered individually against the need to preserve market competition and the long-term interests of all energy consumers,” Ms Savage said.
Notes to Editors
CPU trial waiver conditions
As part of the trial waiver, CPU must:
- Maintain a publicly accessible, current register of the up to 100 chargers on its website, of which at least 5% must have vehicle-to-grid functionality.
- Charge itself access fees equivalent to the annual median access fees charged to unrelated third-party EV charging operators accessing its poles.
- Make reasonable efforts at the end of the trial to offer all EV chargers and the sites to contestable providers to continue operation at the sites.
- Negotiate in good faith with third parties that ask for access to CPU’s distribution poles for kerbside EV charging infrastructure, and publish a negotiation procedure document, and a master document of terms and conditions, for third parties seeking pole access.
- Make reasonable efforts to test the market when engaging e-mobility service providers who will operate the chargers, publish a report containing evidence it has ‘tested the market’ and notify the AER of its publication.
- Publish a list of proposed charger sites and supporting evidence that the sites meet specific criteria for selecting these sites, in particular that the sites experience network constraints, within 6 months of the AER’s decision.
- Provide, along with its annual compliance report to the AER, an audited financial report on an annual basis, including the financial performance of the trial.
- Publish, and notify the AER of its publication, annual data on trial learnings and EV charger performance.
- Annually publish, and notify the AER of its publication, the expected timeframe for processing third parties’ requests to access its poles for EV charging infrastructure.