Effective Date
The guideline takes effect from 1 April 2025.
Reporting to the AER under the new guidelines commences with:
• the immediate and material breach reporting from 1 April 2025
• the first half-yearly report for the period 1 January to 30 June 2024–25 (H2) submissions will be due no later than 31 August 2025
Summary of key changes
3 New Reportable Obligations
Family Violence
The AER maintains in its final decision to include 3 new family violence obligations as reportable due to the high risk of harm. These include requirements regarding family violence policies, safety and security of the customer, and disclosure of a family violence customer details to a third party only provided with customer consent.
When reporting information relating to family violence customers energy businesses should report only de-identified information and if the AER requires access to personal information, the AER will request secure transfer of information.
Table 3.1 Family violence reportable obligations
Introduce | Draft Guidelines frequency | Final Guidelines frequency | Rationale |
NERR rule 76A – Requirement for retailers to have, publish, implement, maintain, comply with, review and update a family violence policy | Half-yearly | Half-yearly | There is a high risk of harm associated with the new family violence obligations. Ensuring the self-reporting of non- compliances protections will enable the AER to monitor and investigate any compliance issues in a timely manner. Given the general support of stakeholders, we are maintaining the original proposal to include the 3 Tier 1 CPP obligations as reportable. |
NERR rule 76D – Requirement that a retailer must first have regard to family violence customer safety and take into account the particular circumstances of the family violence customer | Immediate | Immediate | |
NERR rule 76G(1) – Requirement that the retailer (and its contractors/agents) not disclose or give access to family violence customer information to any other person without the consent of the customer | Immediate | Immediate |
Standing Offer Prices
According to the AER, nearly 1.9 million residential and small business customers were not on market contracts and each of these customers are charged the standing offer prices, and many have not or cannot engage in the energy market.
The requirement to present standing offer prices aligns with the existing requirement to present market offer prices and due to the potential harm from not publishing standing offer prices the AER maintains that section 24 of the NERL is reportable.
Table 3.2 Presentation of standing offer prices reportable obligation
Introduce | Draft Guidelines frequency | Final Guidelines frequency | Rationale |
NERL section 24 – Requirement for retailers to publish their standing offer prices, in accordance with the AER Retail Pricing Information Guidelines | Half-yearly | Half-yearly | Given the general support of stakeholders, we are maintaining the original proposal to include the obligations as reportable. |
Energisation and Re-energisation
New reporting requirements for energisation on customer request and reenergisation of premises have been introduced to ensure timely provision of energy services.
Table 3.3 Energisation on request for sale of energy reportable obligation
Introduce | Draft Guidelines frequency | Final Guidelines frequency | Rationale |
NERR rule 19(2)(b) – Requirement for retailers to, as soon as possible, arrange energisation by a metering coordinator or distributor on request by the customer under a standing offer | Half-yearly | Half-yearly | Given the general support of stakeholders, we are maintaining the original proposal to include the obligations as reportable. |
Table 3.4 Re-energisation reportable obligation
Introduce | Draft Guidelines frequency | Final Guidelines frequency | Rationale |
NERR rules 106 and 106A(1)-(3) – Requirement for retailers to arrange re-energisations in accordance with the energy laws | Half-yearly | Half-yearly | Given the support of stakeholders, we are maintaining the original proposal to include the obligations as reportable. |
NERR rules 106 and 106A(4)-(6) – Requirement for distributors to arrange re-energisations in accordance with the energy laws | Half-yearly | Half-yearly |
Material Breach Reporting
The scope of the material breach reporting requirement has been narrowed. Initially, the draft Guidelines required reporting any material breach of obligations under the NERL, NERR, and National Energy Retail Regulations, except those needing immediate reporting.
Now, only material breaches of civil penalty obligations under the NERL and NERR need to be reported. Additional guidance on what constitutes a material breach, including case study examples in Appendix D. The guidance factors in Table 5 have been updated to balance principles-based guidance with specificity, adding 'customer vulnerability' as a factor and removing the factor related to a reporting entity causing another market participant to fail in meeting a regulatory obligation.
Table 3.5 Material breach reporting
Draft Guidelines position | Final Guidelines position | Rationale |
Definition – Any breach of Retail Law, Retail Rules and Retail Regulations (other than those contained in Appendix A.1) that will likely have a material adverse impact on consumers or the National Energy Market. | Definition – Any breach of Retail Law and Retail Rules civil penalty provision obligations (other than those contained in Appendix A.1) that will likely have a material adverse impact on consumers or the National Energy Market. | In response to stakeholder feedback, we have narrowed the application of the material breach reporting to apply to only CPP of the NERL and NERR that are not immediately reportable. This has removed the reference to Retail Regulations and focused the reporting to ensure that high-risk and/or high potential harm obligations are reportable under material breach reporting. Narrowing the definition will reduce the number of applicable obligations by more than 50%, addressing stakeholders regulatory burden concerns. |
A.3 Material breach reports – guidance, (Table 5 Guidance for determining if a breach is material) sets out 4 factors and provided guidance on each factor. | A.3 Material breach reports – guidance, Table 5 Guidance for determining if a breach is material set out 4 factors and provided guidance on each factor. The 4 factors have remained unchanged while the guidance provided has been amended to be less prescriptive and more principle based. For example, the length of a loss of supply has been removed. | Several submissions sought further clarity on the guidance material, and we have further refined the guidance and provided case study examples to address the matters raised. |
Refinements to Existing Reporting Requirements
The frequency of reporting certain obligations has been reduced from quarterly to half-yearly, including de-energisation and re-energisation obligations and explicit and informed consent requirements. Clarifications have been made to the de-energisation reporting requirements to avoid duplicate reporting.
Streamlined Reporting Obligations
Several lower-risk obligations have been removed from half-yearly reporting, including certain billing requirements, retail contract requirements, explicit and informed consent, distributor interruption to supply, energy marketing activities, and deployment of new electricity meters. However, the AER expects retailers to report serious non-compliances of civil penalty obligations as per the material breach reporting requirements.
Submission Process and Template
Introduction of an online portal for submitting compliance reports, replacing the previous email submission process. Minor changes are proposed to the proformas, and the guidelines will be amended to include, “subject to AER approval, reports maybe submitted via email to AERCompliance@aer.gov.au. The AER will publish a user guide and engage with regulated entities to assist with user access and controls.
Compliance Audits
Clarifications and modifications to compliance audit procedures, including requirements for auditors, audit findings, and invoicing processes.
Conclusion
Active will need to review the new guidelines, the final explanatory statement to consider and analyse what changes are required to systems and processes to ensure compliance with the new guidelines by 2025.