Review of the Regulatory Frameworks for Stand-Alone Power Systems – Priority 2 draft determination

PIAC responded to the AEMC’s Review of the Regulatory Frameworks for Stand-Alone Power Systems – Priority 2 draft determination. 

PIAC considers that as Stand-Alone Power Systems (SAPS) play a greater role in the NEM, it is important that they are appropriately incorporated into regulatory and consumers protections frameworks. This not only ensures consumers continue to fairly receive essential energy services regardless of the method of service delivery, but helps to ensure the efficiency of the system as a whole.

PIAC generally supports regulatory frameworks that retain flexibility, however we are concerned that the tiered framework proposed by the AEMC may lead to:

• unnecessary confusion regarding the protections available to consumers and the obligations placed on providers;
• the potential for forum-shopping by providers to minimise the cost of their regulatory obligations to the detriment of consumers; and
• unequal outcomes for consumers in terms of the availability of SAPS and the protections they receive to continue to access their essential energy services.

Instead, we recommend the AEMC adopt a framework for consumer protections informed by a harm-based approach. We provide principles of harm-based consumers in general and for SAPS in particular.

We also recommend further consultation to provide an opportunity to develop the detail of the proposed framework.