The document discusses recent changes to the competitive metering framework in Australia's National Electricity Market. It provides an overview of the market governance arrangements and the rationale for introducing a retailer-led competitive metering model. Key issues that will need to be considered in implementing the new framework include roles and responsibilities of retailers, distributors and other parties; consumer protection measures; transition issues; and specification of advanced metering functionality. The document also notes how the competitive metering reforms relate to the broader Power of Choice agenda and changes to distribution network pricing. Implementation of the new competitive metering framework will follow a timeline of submissions, draft and final determinations by the Australian Energy Market Commission over 2015.

1. AEMC PAGE 1
Competitive metering in the
National Electricity Market
Thursday 27 November 2014
Brian Spalding, Commissioner
Smart Energy Forum

2. AEMC PAGE 2
Australian Energy Markets
Regulation and governance arrangements
Power system &
market operator
Economic regulation
& rule compliance
Australian Energy Regulator
National Electricity, Gas and Energy Retail Laws
National Electricity, Gas and Energy Retail Rules
Rule maker and
adviser to
governments
Australian
Energy
Market
Commission
Law and policy making
Participants

3. Power of Choice
Enabling consumer choice
AEMC PAGE 3

4. AEMC PAGE 4
Metering rule change
Why change existing arrangements?
• Metering services, enabled by advanced metering
technology and data, help consumers better manage
their energy use
• Retailer-led installation will lead to meters being
installed when the consumer sees a benefit from the
energy management services they enable
• New arrangements will allow metering technology to
be accessed by a number of entities, fostering
innovation in energy management services
• Smart meter installation will support the
implementation of more cost reflective network
pricing arrangements

5. AEMC PAGE 5
Metering rule change
The proposed model

6. Metering rule change
Key issues to consider
• Roles and responsibilities of the relevant parties
– How retailers, ESCOs and distribution businesses work together
under the new framework
• Consumer protection issues
– Consumer consent and safety considerations
• Transition issues for distribution network businesses
– Ability to recover the costs of existing meters
• Minimum services specification for advanced meters
– How smart should these meters be?
AEMC PAGE 6

7. Connection between Power of Choice reforms
AEMC PAGE 7

8. New distribution network pricing
Why change the existing arrangements?
AEMC PAGE 8
• Under previous arrangements
network prices did not reflect
the cost of providing energy
services to consumers
– E.g. air conditioning
impact on network costs
vs consumer bill (left)
• New arrangements
announced today address this
cross subsidisation
• Estimate between 70-80% of
consumers are likely to see
lower network charges as a
result
5 kW air conditioner

9. Metering rule change
Key dates
• 11 December 2014 - submissions due on implementation timetable
• 26 March 2015 - draft determination due 26 March 2015
• 2 July 2015 - final determination due 2 July 2015
AEMC PAGE 9

10. AEMC PAGE 10