The Justice and Equity Centre led a joint consumer and community response to the AEMC’s consultation paper on gas distribution networks: connection and permanent abolishment charges. The submission was co-signed by Sydney Community Forum, Solar Citizens and the Queensland Council of Social Service.
The JEC and Energy Consumers Australia put forward a series of rule change proposals to the AEMC that aim to minimise costs to consumers as we transition away from residential gas use, alongside putting in stronger frameworks and regulations to facilitate the planned retreat of the residential gas network.
The first two rule change proposals focus on disconnection and connections costs and processes.
The proposed changes provide greater certainty for consumers on what costs they can reasonably be expected to bear in relation to both connecting to and disconnecting from their residential gas network. The proposals help ensure:
- Disconnection costs are minimised,
- New connection costs do not add to stranding asset risks,
- Connection and disconnection costs are transparent,
- Connection and disconnection costs are determined and regulated on a consistent and efficient basis,
- Connection and disconnection costs are recovered more equitably,
- Decisions by gas networks and consumers are more informed and efficient, with no unreasonable incentives to connect, or disincentives to disconnect,
- Ongoing gas network safety is supported,
- The rules are more fit-for-purpose to enable the energy system transition and managed retreat of gas networks.
These proposed rule changes cannot and are not intended to resolve all inequity and complexity in the transition away from residential gas use. But they are strong, principled ‘no regrets’ steps which can be built on with further rule change processes expected to follow in 2025-26. Importantly, they help ensure fairer outcomes for all consumers, and better outcomes for disadvantaged and vulnerable consumers struggling with the escalating costs of energy.
Government action will be critical. The rules alone cannot address the issues facing gas networks in the next 10-15 years. Government reforms are needed to support residential electrification, and ensure that consumers facing disadvantage – such as renters, low-income homeowners, migrant communities and apartment dwellers – are not left behind facing unmanageable gas network costs. In the meantime, the proposed rules help mitigate future risks and costs associated with gas networks, and ensure existing gas consumers, particularly those most vulnerable, are not bearing an unreasonable burden to support the connection and disconnection decisions of others.
