Submissions to the Australian Energy Market Commission on Gas Networks in Transition draft rules and determination

These submissions respond to the Australian Energy Market Commission's draft determination on the Gas Networks in Transition rule change process. 

Together, they argue that the regulatory framework must adapt to declining gas demand while ensuring transition costs and risks are allocated fairly, and consumers are protected as more households and businesses electrify. 

The final rules should support orderly network transition planning, protect consumers from unnecessary costs, fairly share risks between consumers and investors, and promote consumers' long-term interests.

1. Our submission

Energy Consumers Australia's submission (PDF, 547.52KB) supports reforms that improve planning, transparency and expenditure assessment as gas demand declines. However, we are concerned the draft determination would shift transition risks and costs onto consumers by allowing gas networks to accelerate cost recovery while limiting regulatory oversight. 

We make three key recommendations:

• Restore the Australian Energy Regulator's discretion over capital recovery decisions
• Require accelerated depreciation to be accompanied by appropriate asset write-downs so costs and risks are shared more fairly between consumers and investors
• Strengthen long-term planning requirements through annual updates, scenario analysis and more detailed network information

Together, these changes would better protect consumers from unnecessary price increases, while supporting an orderly transition for gas networks.

2. Joint submission

The accompanying joint submission (PDF, 216.93KB) from consumer and community organisations re-emphasises that the final rules should not transfer transition risks entirely onto consumers.

These issues matter because consumers, particularly renters, low-income households and others facing barriers to electrification, risk being left with increasing gas network costs as more households switch to electric alternatives.