AER works on improving energy market regulation

ELECTRICITY networks owe customers an explanation of their expenditure and how the money they spend will improve reliable power supply, according to the head of the Australian Energy Regulator.

In an address to the Centre for Economic Development this week, AER chairman Andrew Reeves said the regulator had a new focus on consumers.

The renewed focus, he said, came after Prime Minister Julia Gillard last year announced sweeping reforms to the national energy market to improve the costs households paid on their electricity bills.

She said at the time that the reforms, once implemented, could slash the average household power bill by up to $250 a year.

Mr Reeves, charged with implementing many of the reforms, said the regulator was already working with the industry and consumers to improve the way the energy market is regulated.

He said a key area of focus was on increased consumer participation, in an effort to help consumers get involved and reduce their bills.

Mr Reeves said for the first time, there was a regulatory requirement for electricity networks to consult with their customers; the retail companies which on-sell electricity to homes.

He said the complexity of the market had made it difficult for consumers and representatives to get involved to ensure affect the prices network companies put on the delivery of electricity.

"The important matters of how monopoly industries are regulated, the level of investment in energy infrastructure and how much consumers ought to pay for a safe and reliable supply of energy have come under the spotlight and certainly has been a focus of the AER's work in recent times," Mr Reeves said.

"In essence, the initiatives under way are intended to promote an interactive process in which consumers, the AER and network businesses are all involved in ensuring the services that are valued by consumers are the ones that are provided."

As part of the reforms, a new Consumer Reference Group has been established, and the Federal Government is currently considering creating a National Energy Consumer Advocacy Body to ensure consumers are treated fairly.

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