The Minister for Energy has commenced the Electricity Retail Market Review, which entails a detailed study of retail tariff arrangements, the introduction of full retail contestability (FRC) in electricity and the roll out of smart meters. The Office of Energy has responsibility for completing this review and preparing recommendations for the Minister’s consideration.
Draft Recommendations Report - Electricity Tariffs
The Office of Energy prepared a Draft Recommendations Report detailing recommendations for the Minister’s consideration relating to the retail tariff component of the Electricity Retail Market Review. The Draft Recommendations Report was based on Frontier Economics’ draft recommendations paper titled “Electricity Retail Market Review – Electricity Tariffs”.
Click on the following links to read the Draft Recommendations Report, Frontier Economics Report and the Premier’s Media Statement regarding these reports.
Link to Office of Energy Draft Recommendations Report >>
Link to Frontier Economics Draft Recommendations Paper >>
Link to the Premier's Media Statement 4 April 2008 >>
These reports were released for an eight week consultation period.
Twelve public submissions were received in response to the Draft Recommendations Report and Frontier Economics draft recommendations paper, which can be downloaded from the following links:
Issues Paper
As part of the Electricity Retail Market Review process, an Issues Paper was circulated to key stakeholders for comment in August 2007. A revised Issues Paper considering the additional matters raised by key stakeholders was circulated for broader public comment in December 2007 for a five week public comment period which closed on 25 January 2008. Read more about the Issues Paper >>
Terms of Reference
The Terms of Reference provide details on the scope of the Review. Read the full Terms of Reference. The Review is split into three sections to provide an accurate assessment of each of these components:
1) Review and assessment of electricity tariff arrangements
The Review and assessment of electricity tariff arrangements will involve a comprehensive review of tariff arrangements, the form of a tariff adjustment mechanism, and the arrangements for future tariff reviews. The Review will consider the structure and level of tariffs for all tariff customers:
The aim is to make tariffs more cost reflective, ensure tariffs promote competition, and also examine the merits of time-of-use tariffs and/or critical peak pricing.
2) Assessment of the costs and benefits of the implementation of electricity FRC in Western Australia
The Review will assess the implementation of electricity Full Retail Contestability (FRC). This will include a cost-benefit analysis of the implementation of electricity FRC and an assessment of the arrangements that would be required for FRC implementation (i.e. the appropriate legislation, market rules, market operator, IT systems, and customer protection measures).
3) Assessment of the roll-out of smart meters
The Ministerial Council on Energy (“MCE”) is currently considering the future role of smart meters in Australia and is conducting a cost-benefit analysis of the roll-out of smart meters in all jurisdictions. Following completion of this review, the Western Australian Government will need to consider its approach to the roll-out of smart meters in Western Australia. It is expected that smart meters will also be a necessary requirement for any changes to tariff arrangements involving time-of-use tariffs and/or critical peak pricing. This review will consider the costs and benefits of implementing smart meters in Western Australia.
Further Information
For further details on the Draft Recommendation Report – Electricity Tariffs contact:
Matthew Martin
A/Senior Manager - Markets
Office of Energy
DID: (08) 9420 5683
Tel: (08) 9420 5600
Email: matthew.martin@energy.wa.gov.au
