Our submission (PDF, 553.43KB) to the Australian Energy Market Commission (AEMC)'s Electricity Network Regulation Review responds to questions about when networks, as monopoly businesses, should be allowed to participate in the delivery of contestable services.
We consider that consumers’ long-term interests are promoted when monopoly functions remain regulated; contestable services remain competitive; and network service provider (NSP) participation in contestable markets occurs only where there is a demonstrated consumer benefit, a clear market failure and a proportionate response, accompanied by conditions that ensure that third parties are not disadvantaged.
We call on the AEMC to:
- Clearly articulate which network services remain monopoly services or are now contestable, as an outcome of this review
- Clarify whether, and under what limited circumstances, networks can compete in markets where historically viewed monopoly network services are now viewed as contestable
- Ensure ring-fencing protections remain fit for purpose to prevent the abuse of information asymmetry and monopoly power, if networks are to be allowed to compete in contestable markets
In response to the process, we set out what we see as core criteria for market participation and call on regulators to clarify, as an outcome of the review, what should remain regulated and what should become contestable in a rapidly changing energy system.
