Submission on NSW Committee on Law and Safety’s Inquiry into embedded networks in NSW

PIAC responded to the NSW Committee on Law and Safety’s Inquiry into embedded networks in NSW.

PIAC strongly supports an outcomes or principles-based approach to regulation and consumer protection that ensures the needs of consumers are prioritised over the business model of providers. The framework for energy retail exemptions has created an incentive to use embedded networks and exempt selling arrangements as an additional or improved revenue stream in new developments, and to improve the profitability of commercial operations through providing a poorer, less reliable, less affordable, unsafe or less supported essential service to NSW residents residing in embedded networks. 

We strongly recommended the Committee consider measures to unwind existing embedded networks and exempt selling arrangements to ensure equality of outcomes for all NSW residents, regardless of where they reside. Regardless of whether embedded networks and exempt selling arrangements continue, PIAC encouraged the Committee not to rely upon remedy through national policy and regulation, noting that proposed reforms by the Australian Energy Market Commission (AEMC) have been continually stalled, and the Australian Energy Regulator (AER) have not demonstrated an intent to address the consumer impacts of exempt selling.