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Annual Report 2009-2010 Utilities Commission



Annual Report 2009-2010 Utilities Commission

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Tabled paper 1065


Tabled Papers for 11th Assembly 2008 - 2012; Tabled Papers; ParliamentNT




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23 September 2010 3.83 Following revisions to the Network Access Code from 1 July 2001, in May 2002 the Commission accepted PWCs proposed economic dispatch arrangements pursuant to clause 85 of the Code. Since then the Commission has deferred further development of such arrangements predominantly on the basis of lack of generation competition. Electricity Pricing Orders (EPO) 3.84 Retail electricity prices paid by non-contestable customers, whether residential or commercial, are regulated directly by the Government through an EPO. The Commission is required to enforce compliance with the EPO as if the EPO were a determination of the Commission under the Utilities Commission Act. 3.85 The following EPOs are currently in effect: for customers using up to 750 MWh a year, setting a price path for increases in electricity prices charged by PWC from 1 July 2009 to 30 June 2013, with prices increasing by 18 percent in the first year, a further 5 percent in the second year and then in line with the CPI in the two subsequent years. for the fourth tranche of contestable customers (who use between 750 MWh and 2 GWh of electricity per annum) whose prices remained below cost reflective levels, regulating the maximum price that can be charged to relevant customers until 30 June 2013. PWC is allowed to increase prices by 18 percent in the first year, a further 5 percent in the second year and then in line with the CPI in the two subsequent years, until cost-reflective levels are reached. Full retail contestability 3.86 All electricity customers in the Territory became contestable from 1 April 2010. 3.87 Customers may now choose their retail supplier. However, PWC is currently the only retailer operating in the market. PWC Retail is obliged to continue to maintain newly contestable customers on their current tariff arrangements for a grace period of two years. This means that the tariffs set under the EPO applying to previously non-contestable electricity customers effectively continue to apply until the end of the grace period on 31 March 2012. This includes the price path outlined above. Compliance monitoring 3.88 The Commission is required under the Utilities Commission Act to monitor and enforce compliance by licensed electricity entities with regulatory instruments legislation, licences, codes and guidelines. 3.89 The key compliance issues that arose in 2009-10 were: deficiencies in current compliance monitoring processes; the limited scope of the compliance audits completed for PWC to date; and PWCs breach of its obligations under the Ring-fencing Code in not providing a copy of its related party terms and conditions for nominated goods and services to the Commission by the required date. 3.90 Electricity entities are obliged to comply with applicable codes, rules, protocols and standards, and to notify the Commission of becoming aware of a material breach of any applicable regulatory instrument.