Who benefits from regulatory reform

This submission was made in response to Sydney Water’s price determination for 2016-2020. PIAC welcomes the proposed price reduction for customers but remains concerned about the sustainability of the proposed price, as much of the reduction is due to low interest rates. This period of low interest rates will not remain indefinitely and customers should not be exposed to swings in bill prices because of changes in the financial market conditions. Sydney water is proposing changes to the water and wastewater service charge and the addition of a new service charge with respect to passing the costs of any water purchased from the desalination plant. PIAC is concerned about the impact these changes will have on renters as they will be unlikely to see these changes reflected in rent. PIAC remains concerned about the addition of new fees in the form of late fees and credit card fees. PIAC recommends that the proposed protections for vulnerable customers with respect to the late fee also be applied to the credit card fee. PIAC supports the proposed changes to the service charge terminology to improve customer understanding and engagement with their bills. Sydney Water has proposed significant regulatory changes that will have long-term impacts on customers. PIAC does not support the introduction of a weighted average price cap, as this can lead to gaming of the system and is no longer in use in the NSW energy market.  PIAC supports the adoption of an efficiency benefit sharing scheme as long as it is developed in consultation with customers and is monitoring in this implementation to ensure that customers receive the maximum benefit from such an approach. Finally, PIAC does not support the application of a broad cost pass through mechanism as they type of costs that would be recovered through this mechanism are already recovered through existing methods.