Response to issues paper exempt selling regime madeleine kingston
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- Sale of the Queensland Government’s Energy Retail Businesses
- 53; 61, 62, 64 (resumed); 164, 167-178
3.2 Bulk hot water charging
A retailer must issue bills to a customer for the charging of the energy used in the delivery of bulk hot water in accordance with Appendix 2 of this Code. Where a retailer charges for energy in delivering either gas bulk hot water or electric bulk hot water to a relevant customer, the retailer must include at least the following information (as applicable) in the relevant customer's bill:
370 FRC means "Freedom of Retail Contestability" is a computerized system data build, so that reticulated natural gas selling, and trading, is assigned to customers and natural gas retailers, so that trading and selling of this gas can take place. In Queensland It is imposed on natural gas customers accounts, and is about $25 per year for the first 5 years after the FRC date: 1st June 2007. It accumulates over this first 5 years as a "pass through cost" of about $20 million and will be phased out in a couple of years. Vencorp is to build this system, and is also the referee on this market using the MIRN meter numbering system. 371 Sale of Goods Act 1896 (Queensland) (reprinted and as in force as at 29 August 2007) 372 A misnomer since it is not water that is charged for but the heating component of a composite product where only a single gas (or electricity) meter exists which is used to heat a communal water tank from which water is reticulated in water pipes to the individual abodes of renting tenants either in private of public housing. 373 See Queensland Government Fact Sheet Sale of the Queensland Government’s Energy Retail Businesses.” 2006 blig2006_1-_11_38.fm See also Second Reading Speech by The Hon Anna Bligh (then Treasurer now Premier Queensland) “Energy Assets (Restructuring and Disposal) Bill” Hansard Wednesday 11 October 2006 374 Kingston, M (2007) Submission to MCE SCO National Framework for Energy Efficiency (NFEE2) Discussion Paper http://www.ret.gov.au/Documents/mce/energy-eff/nfee/_documents/e2wg_nfee_stag24.pdf 375 http://www.jemena.com.au/company/downloads/Corporate%20Porfile2009.pdf 376 = Jemena Gas Access Revised Access Arrangement Public Meeting 23 September 2009 377 Source: http://www.duet.net.au/duet/about-duet/structure.htm 378 Ibid 379 http://www.uxc.com.au 380 “Multinet Group Holdings is a Victorian gas distribution company with a network covering 1,940km² of the eastern and south-eastern suburbs of Melbourne. Multinet is currently expanding its geographic base through participation in the state government’s natural gas extension program. Multinet’s distribution network transports gas from the high pressure transmission network to residential, commercial and industrial gas users.” 381 Gas Supply Act 1996 (NSW), last updated 23 March 2010, last accessed 28 May 2010 http://www.legislation.nsw.gov.au/fullhtml/inforce/act+38+1996+cd+0+N#pt.1-sec.3 382 Refer also to the address in August 2009 to the ACCORD Industry by Dr. Stephen Kennedy of the Commonwealth Treasury in which he discusses the broad goals of consumer policy reforms and legislative changes; ibid Kennedy, S (2009) 383 http://www.jemena.com.au/company/downloads/Corporate%20Porfile2009.pdf 384 Jemena Gas Access Revised Access Arrangement Public Meeting 23 September 2009 385 Source: http://www.duet.net.au/duet/about-duet/structure.htm 386 Ibid 387 http://www.uxc.com.au 388 “Multinet Group Holdings is a Victorian gas distribution company with a network covering 1,940km² of the eastern and south-eastern suburbs of Melbourne. Multinet is currently expanding its geographic base through participation in the state government’s natural gas extension program. Multinet’s distribution network transports gas from the high pressure transmission network to residential, commercial and industrial gas users.” 389 The website and 2009 Annual Report of International Power describes itself as “a growing, independent power generation company with interests in over 50 power stations and some closely linked businesses around the world. Its interests include 32.358MW of power generation capacity across five core regions including North America, Europe, Middle East Australia and Asia.” http://www.ipplc.com/ http://annualreport2009.ipplc.investis.com/ 390 Congratulations to Origin. But could these co-generation opportunities and vertical (as well as horizontal) synergistic integrations be facilitating un-monitored practices causing unacceptable market conduct and consumer detriment. Examine for example the “bulk hot water” policy arrangements adopted in several states to seek an answer. 391 http://annualreport2009.ipplc.investis.com/overview/ourportfolio.asp 392 http://www.ipplc.com/ 393 http://annualreport2009.ipplc.investis.com/ 394 Simply Energy Response to ECOSA’s Review of Credit Support Arrangements 16 April 2010 http://www.escosa.sa.gov.au/library/100416-ElectricityCreditSupportArrangementsSubmission-SimplyEnergy.pdf 395 Simply Energy South Australian Retail Review Response to Issues Paper 15 April 2008 396 Queensland Department of Mines and Energy website “Gas Consumption” 397 Energex Supplementary Cost Pass Through Submission 2007 to Queensland Competition Commission (QCC), page 37 of 125 pages, para 4 http://www.qca.org.au/files/E-SuppFRC_Cost_Pass-throughEnergexSep-07.PDF See also other associated documents on QCA website www.qca.org.au See asp Sale of http://www.dme.qld.gov.au/zone_files/Electricity/sale_of_retail_businesses_factsheet.pdf Sale of the Queensland Government’s Energy Retail Businesses.” Department of Mines and Energy2006 http://www.dme.qld.gov.au/zone_files/Electricity/sale_of_retail_businesses_factsheet.pdf To clarify water supply sub-meter requirements in community titles and buildings with community bulk hot water services See also Body Corporate and Community Management and Other Legislation Amendment Bill First and Second Reading Speech and Explanatory Notes. Hansard 11 October, pp68-71
398 Minter Ellison Lawyers “Sale of Queensland Government’s retail energy assets.” http://www.minterellison.com/public/connect/Internet/Home/Expertise/Track+Records/TR+-+Sale+of+Sun+Retail 399 Energy Assets (Restructuring and Disposal Bill 2006 Queensland. Legislative Assembly Queensland Parliament Whole transcript the following Queensland Hansard pages are relevant: 53; 61, 62, 64 (resumed); 164, 167-178 (12Oct06) (First and second readings reintroduction) 231 (31Oct06, 559. See views and concerns raised including from Dr. Flegg about the rushing of the debate of such importance; and of Mrs. Cunningham regarding the provisions regarding appeal and future sales without recourse to Parliament http://www.parliament.qld.gov.au/view/legislativeAssembly/hansard/documents/2006.pdf/2006_10_11_WEEKLY.pdf Home page Parliament www.Queensland.gov.au Hansard ISSN 1322 0330 Record of Proceedings http://www.parliament.qld.gov.au/view/legislativeAssembly/hansard/documents/2006.pdf/2006_10_11_WEEKLY.pdf http://www.parliament.qld.gov.au/view/legislativeAssembly/hansard/documents/2006.pdf/2006_10_12WEEKLY.pdf http://www.parliament.qld.gov.au/view/legislativeAssembly/hansard/documents/2006.pdf/2006_10_31WEEKLY.pdf 400 Energex 2007 Annual Report 2007, CEO’s Report, pp 19-21 http://www.energex.com.au/pdf/about_energex/annualreportpdfs07/4_business_review.pdf 401 Queensland Government Department of Mines and Energy Fact Sheet September 402 Ergon Energy Annual Report c/f ENERGEX’S Supplementary Submission Cost Pass Through Submission 2007 to Queensland Competition Commission (QCC), p37 of 125 (ENERGRX ABN 40 078 49 055) http://www.qca.org.au/files/E-SuppFRC_Cost_Pass-throughEnergexSep-07.PDF 403 Whole transcript the following Queensland Hansard pages are relevant: 53; 61, 62, 64 (resumed); 164, 167-178 (12Oct06) (First and second readings reintroduction) 231 (31Oct06, 559. See views and concerns raised including from Dr. Flegg about the rushing of the debate of such importance; and of Mrs. Cunningham regarding the provisions regarding appeal and future sales without recourse to Parliament 404 Energex Supplementary Cost Pass Through Submission 2007 to Queensland Competition Commission (QCC), page 37 of 125 pages, para 4 http://www.qca.org.au/files/E-SuppFRC_Cost_Pass-throughEnergexSep-07.PDF See also other associated documents on QCA website www.qca.org.au This matter has ongoing implications for regulatory decisions not restricted to the affairs of Energex Retail Pty Ltd (ERPL), Of the 13,700 serviced hot water customers” providing a lucrative business not involving direct supply of other electricity or gas, but nevertheless deemed to be receiving one or the other, some 2,500 were in the “gas bulk hot water” captured unregulated market 405 Ibid Energex Supp Cost Pass Through Sub 2007 406 Queensland Government Department of Mines and Energy Fact Sheet September Please also refer to the Queensland Auditor-General’s Report 2007, 407 Queensland Auditor-General’s Office (OA) Report to Parliament No. 9 for 2007 Results of Audits as at 31 October 2007. Executive Summary as at 31 October 2007 http://www.qao.qld.gov.au/downloadables/publications/auditor_general_reports/2007%20Report%20No%209%20Executive%20Summary.pdf 408 Minter Ellison Lawyers “Sale of Queensland Government’s retail energy assets.” http://www.minterellison.com/public/connect/Internet/Home/Expertise/Track+Records/TR+-+Sale+of+Sun+Retail 409 Fact Sheet (2008) issued by the Queensland Department of Infrastructure and Planning Fact Sheet “Plumbing Newsflash” http://www.dip.qld.gov.au/resources/newsletter/newsflash-311.pdf Issued: 08/04/2008 Newsflash 311 Purpose of Fact Sheet: To clarify water supply sub-meter requirements in community titles and buildings with community bulk hot water services. Disclaimers contained as to legality in particular circumstances but nevertheless impacting adversely on public housing tenants and others in similar circumstances residing in flats and apartments and or occupying other residential or non-residential premises See also Body Corporate and Community Management and Other Legislation Amendment Bill 2006 First and Second Reading Speech and Explanatory Notes. Hansard 11 October, pp68-71
410 s74 appears to have been repealed so the reference terms are inaccessible or may have been changed 411 s75 appears to have been repealed so the reference terms are inaccessible or may have been changed 412 Refer for instance to AEMC/AEMO Draft Rule Determination National Electricity Amendment (Cost Recovery for “Other” Services Directions Rule 2010 “Conclusion 6.4 The changes proposed in the Rule Change Request would address the issues identified by AEMO by putting in place regionalization of cost recovery. It would also remove the now redundant reference to the fixed component of participant fees, promoting good regulatory practice 413 Legislative Assembly Parliament of Queensland, Hansard 11 and 12 October 2006 First and Second Reading Speech, especially pages 1 and 2 regarding warranties and guarantees offered to the purchaser of certain contestable and non-contestable assets the latter including to “bulk hot water provision and the captured monopoly clientele who receive not energy but heated water in water infrastructure See whole transcript the following Queensland Hansard pages are relevant: 53; 61, 62, 64 (resumed); 164, 167-178 (First and second readings reintroduction) 231, 559. See views and concerns raised including from Dr. Flegg (Lib Mogill) about the rushing of the debate of such importance; and of Mrs. Cunningham, Independent regarding the provisions regarding appeal and future sales without recourse to Parliament http://www.parliament.qld.gov.au/view/legislativeAssembly/hansard/documents/2006.pdf/2006_10_11_WEEKLY.pdf http://www.parliament.qld.gov.au/view/legislativeAssembly/hansard/documents/2006.pdf/2006_10_12_WEEKLY.pdf I cite “Mrs. Cunningham: However, there are a few issues of concern that I want to raise. There is a clause in this legislation that removes the ability of decisions made under this legislation to be reviewed, including judicial review. In our original briefing I was advised that that in part was to have regard to the caretaker convention should an election occur before this bill was fully enacted. Given that the election has been completed, I question why that condition has to be reinserted to the same extent as it was previously or whether there are other purposes for that non-reviewable clause to be included “Dr FLEGG (Moggill—Lib) (11.58 am): I rise to speak to this bill, which relates to the privatization sale of extensive energy assets held by the state of Queensland. At the outset, I want to say that the government, by applying the guillotine to the debate of this vital bill, is insulting the people of Queensland” Refer also to Body Corporate and Community Management and Other Legislation Amendment Bill (Queensland) 11 October 2009, pp 68-70 and implications. http://www.parliament.qld.gov.au/view/legislativeAssembly/hansard/documents/2006.pdf/2006_10_11_WEEKLY.pdf Page 70 states that The Body Corporate and Community Management Act 1997 (BCCM regulates some 33,000 community titles schemes containing over 303,000 lots of units. It was estimated at the time that well over 500,0000 Queenslanders live in apartments or units. In addition a significant proportion of Queensland’s estimated eighteen and a half million annual visitors and tourists choose to stay in community title apartments and units during their stay rather than hotels and motels. Kevin McMahon’s publically available story indicates that he has battled long and hard against the odds to achieve fairness in provision for access to centrally heated apartment managed by BCCM. The arrangements made as a result of the Energy Assets Restructuring Bill, which was rushed through in a desperate hurry and considered by those passing the Bill to be “unusual” because of this, have hampered any scope to obtain justice in the calculation of equitable charges. The matter raises issues of parity also and as discussed elsewhere the legal and scientific unsustanability of the provisions for “delivery of bulk hot water.” In Queensland changes to other provisions including under the Planning Department’s regulations permit water to be sold as a commodity, whilst energy charges are imposed, calculations made in cents/litre and redress options non-existent The Bill referred to is weighted in favour of the BCCM. Public tenants have little say and certainly with regard to the BHW arrangements no accessible rights at all. [1] See Minster Ellison: Sale of Queensland Government's retail energy assets http://www.minterellison.com/public/connect/Internet/Home/Expertise/Track+Records/TR+-+Sale+of+Sun+Retail (1 of 2) 28/09/2009 last accessed 2 June 2010 See discussion under “Competition Issues” Refer also to Kevin McMahon’s submission to the NECF2 Package as a victim of the bulk hot water policies and residential tenant of public housing authorities in Queensland. As also included as sub 46 to the Senate Standing Committee’s Consumer Policy Inquiry TPA-TPA-Bill2, to which I have referred in several submissions and communications/
414 Dufty G and Langmore M (2004) Domestic electricity demand elasticities, Issues for the Victorian Energy Market. St. Vincent de Paul http://www.vinnies.org.au/files/VIC/SocialJustice/Reports/2004/2004%20June%20-%20Domestic%20Electricity%20Demand%20Elasticities.pdf last viewed 21 Jan 2013 415 Dufty (2007) Electricity Pricing: Delivering social justice and environmental equity St Vincent de Paul August 2007 http://www.vinnies.org.au/files/VIC/SocialJustice/Reports/2007/2007%20-%20August%2016%20-%20Electricity%20Pricing%20-%20cuac%20elasticitites%20.pdf last viewed 21 Jan 2013 416 Gary Bugden The Arrow Asset Management case has implications for the whole of Australia last viewed 21 January 2013 http://www.mystrata.com/doc-store/Arrow-Asset-Management.pdf Gary Bugden is a name associated with strata titles since 1973, specialist lawyer, academic law reformer. Though retired from practice Gary Budgen remains involved in the industry through his writings speaking engagement and other activities. 417 Francesco Andreone (2009) and (2011) The Implications of the Arrow Asset Management Case Presented by author at the Strata and Community Title in Australia for the 21st Century III Conference in 2011. The paper acknowledges Gary Bugden’s work http://www.francescoandreone.com/uploads/4/0/0/6/4006916/paper_-_griffith_university_-_the_arrow_case_-_august_2009.pdf last viewed 21 January 2013 418 I have discussed many of these issues previously in submissions to the AER, AEMC MCED SCO (now SCER arenas) I call attention yet again to my extended multi-part submissions to the Productivity Commission’s Review of Australia’s Consumer Policy Framework and to the submissions of others to that arena Madeleine Kingston (2008) www.pc/data/assets/consumer/subdr242; http://www.pc.gov.au/__data/assets/pdf_file/0006/89196/subdr242part4.pdf
419 1 One example is the Energy Assets (Restructuring and Disposal) Act 2006 (Qld) See Queensland Legislative Assembly, Hansard pp 53; 61, 62, 64 (resumed); 164, 167-178 (First and second readings reintroduction, (then) Qld Treasure and Minister for Infrastructure) pp231, 559. 11, 12, 31 October 2006 http://www.parliament.qld.gov.au/view/legislativeAssembly/hansard/documents/2006.pdf/2006_10_11_WEEKLY.pdf http://www.legislation.qld.gov.au/LEGISLTN/ACTS/2006/06AC042.pdf 420 2 See for example the extraordinary and perhaps misguided arrangements, guarantees, warranties and assurances provided to purchases within the energy industry of energy (and impliedly other assets and/or client bases 421 Updated from version submitted to Senate Economics Committee’s Consumer Enquiry (TPA-ACL-Bill 2) (2010). Report completed. Bill passed. Trade Practices Act 1974 to be renamed Competition and Consumer Law; and earlier version submitted to the NECF2 Package and published on the MCE website 422 I confirm my serious and ongoing concerns regarding the Essential Services Commission’s perceptions and/or policy maker Department of Primary Industries regarding reliance on and interpretation of the Gas Industries Act 2001, in conjunction with the Gas 423 Please also refer to my multi-component submission to the Productivity Commission’s review of Australia’s Consumer Policy Framework www.pc.gov.au/data/assets/consumer/subdr242; http://www.pc.gov.au/__data/assets/pdf_file/0006/89196/subdr242part4.pdf 424 This instrument was intended as for short term transitory provision of electricity only embedded situations where actual flow of energy was effected to the party deemed to be receiving it, but where network ownership and/or operation changed hands and distribution was not effected by the original distributor. This raises liability issues and reinterpretation of the tripartite governance model. The AER will make piecemeal exemptions as requested. See Letter dated 21 March 2006 from the Victorian Energy Minister Theo Theophanous to ESC Small Scale Licencing Review 2006, no longer accessible o ESC site, so I cannot provide a direct online link However I did save the document as a .pdf and sent it by email on 23 April 2010 to the Senate Economics Committee in the context of their Trade Practices-Australian Consumer Law Enquiry, along with a .pdf copy of the original Orders in Council [OIC] pursuant to s17 of the Electricity Industry Act 2000 (the Act) effective date 1 May 2002 I will attach this and the .pdf copy of the relevant Order in Council as separate attachments to my Main submission. Please would the AER publish this in addition to the consolidated appendices 1-15 The letter in particular states at p1 that: “Whilst some recent exemption Orders have dealt with small scale arrangements, this should be regarded only as a temporary measure, pending the development of more appropriate regulatory instruments. The Government would prefer not to rely on exemption Orders as the primary regulatory instrument for these embedded customer situations” The Orders in any case refer to electricity and not to GAS, as admitted by the ESC in their Final Recommendations of March 2007Small Scale Licencing Framework Final Recommendatijons Marhc 2007 found at http://www.esc.vic.gov.au/getattachment/819e811f-e249-4a8a-85d3-28cdcefa232e/Small-scale-licensing-framework.pdf I really must ask the question without intending any offence: Will the AER be any better able to handle these complex matters in the context of the rushed and in my view poorly considered Exempt Selling Regime (accepting that policy decisions must surely come from the employing authority the AEMC, despite notional perceptions of integration with the ACCC? The EMC reimburses the AEMC for all expenses incurred by the AER and insists on selection of staff and joint advertising. So how does that result in separation between policy-maker and regulator and with what outcomes? 425 In the absence of ready access to the online link for the letter from the Minister for Energy (but nevertheless in possession of a hard copy as well as a pdf copy sent to the Senate Economics Committee on 23 April 2010, I note the comments made by the ESC in their Final Report cited verbatim.: The small scale distribution and/or resale of electricity are currently regulated under the provisions of a general Order-in-Council (OIC) which exempts certain persons from obtaining a licence under the Electricity Industry Act 2000 (EIA 2000). Small scale operators may also obtain a specific exemption from the Governor-in-Council. In contrast, there is no general OIC applying to the small scale distribution and/or reselling of gas. As such, entities wishing to undertake the distribution and/or resale of gas at any scale must first either obtain a licence under the Gas Industry Act 2001 (GIA 2001), or obtain a specific exemption from the Governor-in-Council. While exempt from the obligations pertaining to a licence, the general OIC sets out certain terms, conditions and limitations that those exempted by the OIC must comply with to retain their exemption. Currently, there is no agency responsible for oversighting whether small scale distributors and resellers of electricity are compliant with the requirements of the OIC. In effect, those undertaking the intermediary distribution, supply and/or resale of electricity self-assess themselves against the requirements of the OIC.” The Report refers to the letter from Letter from the Minister for Energy Industries to the Chairperson of the Essential Services Commission of Victoria, 21 March 2006 but I cannot access this as before 426 Essential Services Commission (2012) Harmonization of Energy Retail Code and Guidelines with the National Energy Customer Framework (NECF) – Consultation Paper December 2012 Ref C/12/37632 http://www.esc.vic.gov.au/getattachment/6e7f7cd5-64a1-46c3-a8f7-467124b3a0f9/Consultation-Paper-Harmonisation-of-Energy-Retail.pdf last viewed 21 January 2013 427 This is a crucial item of supporting evidence which I can no longer locate online on the ESC website or through regular and repeated Google searchers However I am pleased to say that when it was readily accessible the letter dated 231 March 2006 addressed to Mr. Greg Wilson, then Chairperson of the ESC re Small Scale Energy Distribution and Reselling was retrieved as a .pdf document and forwarded by me on 23 April 2007 to the Senate Inquiry Australian Consumer Law (ACL) Bill For logistic reasons is too complicated at this late hour to separate this and a related document as a .pdf Order in Council pursuant to s17 of the Electricity Industry Act to neatly fit in with other Appendices as previously sent to the AER and other arenas and published as a composite document Yüklə 3,13 Mb. 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