The Australian Energy Market Commission (AEMC) has proposed new rules to better equip the regulators to set prices so that ‘consumers don’t pay more than necessary for reliable supplies of energy and gas.’

 

The Commission released a draft determination outlining better economic regulation of network service providers and price and revenue regulation.

 

The draft determination would:

  • allow the Australian Energy Regulator (AER) to benchmark network businesses against each other;
  • require the AER to publish annual benchmarking reports on network business performance;
  • allow the AER to take past efficiency into account when determining future spending allowances for network businesses;

 

AEMC Chairman, John Pierce, said the draft rules were now available for public review and comment before a final decision was made.

 

“This draft determination aims to improve the capacity of the AER by giving it new tools to determine efficient costs for each regulated business – and enabling it to decide what costs are efficient.”

 

While the AEMC has urged the creation of more efficient regulation of the market to ensure better outcomes for capital investment, while also attempting to diversify ways in which consumers can choose electricity access.

 

Public submissions are being sought on the proposed changes before 4 October before the final determination is released in November.

 

The draft determination if available here (.pdf)