Overview
The Victorian Government has asked the Essential Services Commission (via an order in council) to set a maximum price for exempt sellers. This will help Victorians in embedded networks get a fairer electricity price.
The commission released its draft decision on the maximum prices exempt sellers may charge customers in embedded networks on 6 May 2020. Consultation is open until 15 June 2020.
The draft decision reduces the maximum prices most customers can be charged. Residential and small business customers would not pay more than the Victorian Default Offer (VDO) price for their distribution zone.
The draft decision provides a further opportunity for you to provide feedback before the commission makes their final decision in July.
Some electricity sellers are exempt from requiring a retail licence. Generally exempt sellers buy electricity at a ‘gate’ meter, on selling it to individual customers. Exempt seller also refers to people who supply electricity in an embedded network.
Exempt sellers who sell electricity to residential and small business customers through an embedded network may include caravan parks, retirement villages, shopping centres, apartment buildings, rooming houses.
Examples of embedded networks
This image shows the energy grid connecting to a retirement village, an apartment building, a caravan park and a shopping centre.
How does this affect you?
The commission wants embedded network customers to have protections available to other customers. The Victorian Government recently froze the maximum price exempt sellers can charge embedded network customers at standing offer prices that applied in early 2019. These prices are usually higher than what other types of customers are paying. These standing offer prices apply until the commission sets prices that meet the requirements of the exemption order.
What have we done so far?
In February 2020, the commission released its consultation paper on the maximum prices that embedded networks and other exempt sellers may charge customers. The consultation paper sought feedback from stakeholders whether the Victorian Default Offer should form the basis of a maximum price for embedded networks. The commission also wanted to know if there was any other information that should be considered and encouraged stakeholders to make submissions to the process. In response the commission received 34 submissions which have informed the draft decision.
What are we doing now?
The commission is currently consulting on the draft decision before the final decision is made in July 2020.
Key facts from the draft decision
Embedded network customers should be able to access price protections that are as consistent as possible with those applying to customers more readily able to access market offers.
Our draft decision is that the maximum price for residential and small business customers (those consuming no more than 40 megawatt hours of electricity per year) within embedded networks will be set at the level of the Victorian Default Offer (VDO). This covers most embedded network customers.
For a relatively small group of customers, including large businesses, we have not applied the Victorian Default Offer as the maximum price. For these customers, maximum prices would remain at current levels.
The draft decision means many customers in embedded networks could save hundreds of dollars a year.
The new maximum prices would apply from 1 September 2020, this provides a reasonable timeframe for stakeholders to provide feedback on our draft decision.
Read the draft decision
Have your say
The commission wants your feedback on:
- The application of the Victorian Default Offer as the new maximum price exempt sellers may charge residential and small businesses customers (with usage up to 40 megawatt hours of electricity per year).
- The categories of exempt sellers to which the draft decision applies.
- The tariff structures proposed in the draft decision – including the flat rate tariff for both residential and small business customers and the Victorian Default Offer compliant maximum annual bill (for non-flat tariffs).
- Any other comments relating to implementation of new maximum prices.
You can have your say on this page by:
- posting a question or comment for a response by our team within 3 days in our 'virtual public forum'
- attending our online public forum on 28 May 2020
- providing us with some general comments about the draft decision
- responding directly to the questions for stakeholders, or
- uploading a submission document.
Our virtual public forum
You can ask us questions or provide us with feedback for us to respond to. We will try to reply within 3 business days. All questions will be reviewed for offensive content before being published.
General comments
General comments
Collection Notice
As part of making a submission, we need you to provide personal information, such as your name, email address, and postcode. We will use this information to send you updates about this review.
It is our policy to publish all submissions to reviews on the Essential Services Commission website. You can request anonymity by selecting the relevant tickbox.
When we publish a submission, we also include some details about the submitter (your name, not your address). We treat all submissions as public information unless the submitter has asked us to.
We may also collect personal information when you email us with a query. Aside from any exceptions in relevant privacy legislation, we will not use or disclose the information you provide for any purpose other than to progress and respond to your query.
You have the right to access personal information we hold about you. We may ask you to pay a small fee for this. You can also request that we correct your personal information in our records at no charge.
Read more information about our submissions policy.
About us
The Essential Services Commission is an independent regulator that promotes the long term interests of Victorian consumers with respect to the price, quality and reliability of essential services. We regulate Victoria’s energy, water and transport sectors, and administer the local government Fair Go Rates system.
Questions for stakeholders
Collection notice
As part of making a submission, we need you to provide personal information, such as your name, email address, town of residence and postcode. We will use this information to send you updates about this review.
It is our policy to publish all submissions to reviews on the Essential Services Commission website. This process may involve publishing your personal information (your name, not your address). You can request anonymity by selecting the relevant tickbox.
We may also collect personal information when you email us with a query. Aside from any exceptions in relevant privacy legislation, we will not use or disclose the information you provide for any purpose other than to progress and respond to your query.
You have the right to access personal information we hold about you. We may ask you to pay a small fee for this. You can also request that we correct your personal information in our records at no charge.
Requesting anonymity
You can request anonymity by selecting the relevant tickbox on this page. Depending on the circumstances, requesting anonymity may affect the weight we can give to your submission. Information that influences our decisions generally needs to be disclosed so stakeholders can understand the reasons for our findings.
Read more information about our submissions policy.
About us
The Essential Services Commission is an independent regulator that promotes the long term interests of Victorian consumers with respect to the price, quality and reliability of essential services. We regulate Victoria’s energy, water and transport sectors, and administer the local government Fair Go Rates system.
Upload submission
Upload a formal submission
Collection Notice
As part of making a submission, we need you to provide personal information, such as your name, email address, and postcode. We will use this information to send you updates about this review.
It is our policy to publish all submissions to reviews on the Essential Services Commission website. You can request anonymity by selecting the relevant tickbox.
When we publish a submission, we also include some details about the submitter (your name, not your address). We treat all submissions as public information unless the submitter has asked us to.
We may also collect personal information when you email us with a query. Aside from any exceptions in relevant privacy legislation, we will not use or disclose the information you provide for any purpose other than to progress and respond to your query.
You have the right to access personal information we hold about you. We may ask you to pay a small fee for this. You can also request that we correct your personal information in our records at no charge.
Read more information about our submissions policy.
About us
The Essential Services Commission is an independent regulator that promotes the long-term interests of Victorian consumers with respect to the price, quality and reliability of essential services. The commission regulates certain Victorian energy businesses (including electricity generators, transmission companies, distributors and retailers) through a combination of legislation, licences, and codes and guidelines. View more on how we regulate.
