POWER OF CHOICE

Daniel HardingManager – Energy Policy

Ministerial Workshop PresentationTuesday 14 November 2017

Power of Choice

• Power of Choice energy market reforms commence in the ACT from 1 December 2017

• Metering services will become the responsibility of electricity retailers

• Electricity retailers will compete with each other and provide metering as part of their energy plan offers to customers

• New or replacement meters will be a smart meter (including voluntary replacements)

• Power of Choice will give customers more control over how and when they use electricity, and their costs

Why Power of Choice?

1. The cost of high customer peak demand is not fairly allocated2. Cross-subsidies are paid by other customers (several hundred

$ per year) to those with high peak demand3. High peak demand is driving up costs for all users (through

higher network investments)4. Customers lack information on how to improve their usage

patterns (reduce bills)5. Retailers and third parties lack incentives for product and

service innovations that can benefit customers

Why Power of Choice?

Services made possible by Smart meters

Key points

• Most customers won’t see any change on 1 December

• Smart meters are only required when existing meter needs replacing, or in new buildings. Customers can keep their existing meter, or opt-in at any time.

• Customers retain the power to choose their preferred retailer, and their preferred retail energy plan

Smart Meter Issues raised by stakeholders

• Potential ‘bill shock’ for high-peak demand customers on new plans

• Privacy

• Security

• Health and Safety

• Remote disconnections

Tenant/Lessor arrangements

• The lessor retains obligation under Residential Tenancies Act 1997 to ensure physical supply of electricity to a property

• If a meter fails, the tenant will contact their preferred retailer to have a smart meter installed. The lessor cannot block this work, and will need to meet the cost of any extra electrical work needed to retain a physical supply

• If a tenant wants to upgrade the working meter to a smart meter, lessor approval would be required. This is similar to seeking approval for any other improvement to the rental property

Discussion

• What are the key Power of Choice issues for your stakeholders?

• What more could government, energy businesses and community groups be doing to ensure a smooth transition?

BACKGROUND SLIDES…

Power of Choice changes

Wholesale(Competitive)

Networks(Regulated)

Retail(Competitive)

• Roles and responsibilities of the electricity distributor andelectricity retailers are changing

What the new changes will do

Competition

New services

Retaining consumer protections

Simplicity forconsumers