Minister for Energy and Resources Michael O’Brien today welcomed the release of a report that supports Victoria’s view that energy consumers are being disadvantaged by the appeals system for regulatory decisions on energy network charges.
“The Victorian Coalition Government has been a leader in pushing for changes to the regulatory regime for network charges to deliver better results for households who are facing rising energy prices,” Mr O’Brien said.
“This report strongly backs the Coalition Government arguments that the current appeals regime is not delivering the best results for consumers,” Mr O’Brien said.
“Victoria will continue to make the case for a fairer regulatory system that gives electricity consumers a fair go,” Mr O’Brien said.
The appeals regime in the National Energy Market, known as the Limited Merits Review, determines how electricity companies can challenge regulatory decisions regarding what they can charge for “poles and wires” infrastructure, which make up over 40 per cent of consumers’ bills.
The Coalition Government argued for the Australian Government’s Standing Council on Energy and Resources to conduct a review of the regime.
The review is in two stages. Stage one considered how the regime has operated to date. Stage two will make recommendations for improving the regime for the future.
The first stage of the process has now been completed and the panel has found the Limited Merits Review process is not fulfilling the intended policy objectives and does not appear to be providing adequate consideration of the long term interests of energy consumers.
“Doubts about the effectiveness of the regulatory arrangements have a basis in the facts that some of the Australian Competition Tribunal’s decisions have had major implications for network charges and end consumer prices.” (Stage One Report, p.4)
The Panel will be providing its final report to the Standing Council by 30 September 2012.
The Expert Panel’s report is available at www.scer.gov.au/workstreams/energy-market-reform/limited-merits-review/