Submission to consultation paper on regulatory sandbox arrangements

Publication date:
5 February 2019
Resource type:

PIAC lodged a submission to the AEMC’s consultation paper on regulatory sandbox arrangements to help develop proof-of-concept projects to help inform future regulatory reforms in light of the ongoing transformation of the electricity sector. This transformation will require energy policy and regulatory frameworks that balance appropriate levels of protections so consumers continue to enjoy energy supply now while enabling the innovation and investment needed for the future.

PIAC argues that, while the policy and regulatory framework for energy is complex and imposes burdens on businesses, the essential question to consider is whether these burdens are proportionate to the harms they intend to prevent.

In order to address potential harms to consumers, energy regulations must strike a balance by providing appropriate levels of protection whilst also removing barriers to entry and providing the long-term certainty to facilitate the innovation and investment needed to unlock the full benefits possible in the current transformation in energy.

Therefore, a well-designed regulatory sandbox must include:
an appropriate assessment prior to commencing the trial which must include, amongst other things, a robust justification that the greater benefits from conducting the trial outweigh the cost and potential risk to sandbox consumers;
· ongoing monitoring of the trial including the effectiveness of the product/service being trialled and the effectiveness of the consumer protections; and
post-trial review including sharing of data/lessons learnt, and informing any other (ongoing or subsequent) sandbox trials.

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