Radhakrishnan PriyancaELECTRICITY INDUSTRY AMENDMENT BILLThird ReadingHon PRIYANCA RADHAKRISHNAN (Minister for the Community and Voluntary Sector) on behalf of the Minister of Energy and Resources: I present a legislative statement on the Electricity Industry Amendment Bill. SPEAKER: That legislative statement is published under the authority of the House and can be found on the Parliament website. Can I ask all members leaving the Chamber to do so quietly and quickly. Thank you. Hon PRIYANCA RADHAKRISHNAN: I move That the Electricity Industry Amendment Bill be now read a third time.This bill will implement a number of the recommendations from the 2019 Electricity Price Review. It will support the Government's efforts to adopt the right regulatory and market settings for an electricity system that supports a low-carbon economy. The bill will promote competition and innovation in emerging distributed-energy markets for example by allowing the Electricity Authority to amend extend or revoke arm's length requirements between distributers and affiliated businesses. It will reduce industry costs through enabling the Electricity Authority to regulate more standardised distribution access agreements and will protect the interests of small consumers through providing clearer powers for the Electricity Authority to regulate how retailers deal with medically dependent and vulnerable consumers such as for non-payment of their electricity bill. The bill has four main purposes which are to provide for the establishment of a small electricity consumer advocacy agency and enable the levy on industry participants to recover the Government's costs relating to small electricity consumer advocacy to remove ambiguity in relation to the ability of the Electricity Authority to amend the Electricity Industry Participation Code 2010—or the code—for the purpose of protecting household and small-business consumers to provide more regulatory agility to promote competition in evolving contestable markets by shifting from the Act to the code a number of existing provisions relating to a distributor's involvement in generation or retailing activities and to ensure that the code can regulate distribution access terms and conditions as it already does in relation to Transpower. We've had robust scrutiny of this bill through the select committee second reading and during the committee of the whole House just yesterday. A number of clear focus points emerged in these debates such as the small electricity consumer advocacy agency and the backstop power given to the Minister of Energy and Resources. I will address the points raised in previous debates on these issues to help ease members' concerns but first I want to speak to the two amendments made to the bill yesterday through the Supplementary Order Paper tabled by the Government. The two amendments were to include a transition period for the Electricity Authority's additional objective and to allow for remote attendance at annual meetings of beneficiaries of energy trusts. Clause 9 of the bill inserts an additional objective for the Electricity Authority of protecting the interests of domestic consumers and small-business consumers in relation to the supply of electricity to those consumers. In order to allow sufficient time for the Electricity Authority to make the appropriate preparations for this change including ensuring consistency between its current and new objectives a four-month transition period has been added to the bill. Clause 9 is the only clause that is proposed to have a delayed commencement with the remainder of the bill coming into force on the day after the date of Royal assent. The other amendment addresses a lack of clarity in the existing legislation about whether annual meetings of beneficiaries of consumer trusts with shareholdings in distribution companies are allowed to be held virtually. This amendment inserts a new clause 32A which amends section 102 of the Act which sets out the procedures for annual meetings to appoint an auditor. One of the focus points of previous debate on this bill has been the role of the small electricity consumer agency and the funding for this agency. The Electricity Price Review found that household and small-business electricity consumers struggle to make their voices heard and to exert influence over decisions affecting them in the electricity sector. Large industrial consumers in contrast have their own advocacy body which provides evidence-based policy advocacy to regulators. This bill will help address this imbalance in bargaining power and representation in the decision-making process for households and for small businesses. Another criticism that has been levelled against the small electricity consumer agency is that it will lead to increased consumer bills. The Electricity Price Review estimated that if the agency had a budget of $2 million this would be a small increase of less than $2 per year on consumer electricity bills if the Government decided to recover the agency's costs. The bill does contain a provision to enable either a portion of or all of the costs of the agency to be recoverable from the industry levy but there is no plan at this time to amend the levy regulations to recover the agency's costs incurred to date. Funding for small-consumer advocacy is being provided from Budget 2020. It's not being funded through consumer bills. Another focus point of debate on this bill has been the time-limited backstop power given to the Minister of Energy and Resources through this bill. The concern is that this power will give any Minister of Energy and Resources unrestricted ability to act as if they were the Electricity Authority. This is not the case. The bill grants the Minister power to amend the code for a small number of specified matters only if satisfactory progress has not been made on these matters. The specified matters were recommended by the Electricity Price Review as important matters requiring code amendment and the Government agreed that they were priorities for the Electricity Authority to address. This power is time-limited and is actually being brought forward by one year to help lessen any regulatory uncertainty that may arise. I would also note that there is precedent for this approach as it reflects what was done with the establishment of the Electricity Authority under the National-led Government in 2010. Finally I wanted to highlight some of the other provisions included in this bill which will help ensure an effective regulatory framework for the electricity industry in view of rapidly evolving technologies and business models. Clause 9 of the bill gives the Electricity Authority the additional objective of protecting the interests of household and small-business consumers in their dealings with industry participants. Despite the reference to the benefit of consumers in the authority's objective there is uncertainty regarding the extent to which the code may include provisions to protect the interests of small consumers in their dealings with industry participants. Protecting small consumers is intended to be a relevant consideration for a relatively small portion of the Electricity Authority's work. It is expected to come into play only when the Electricity Authority is considering the conduct of retailers and other participants that deal directly with small consumers where there is an imbalance of power in those dealings that can result in adverse outcomes for small consumers. This bill will help enable more flexible and responsive regulations to help promote competition. The Electricity Price Review recommended that the Electricity Authority should be able to develop rules in the code a secondary legislative instrument that can respond if distributors use their monopoly position deliberately or inadvertently to deter competitors from entering markets or to disadvantage those already in the market. This will help ensure that consumers can benefit from new products and services that offer high quality lower cost and more choice enabled by these emerging technologies and services. The bill will move some provisions from Part 3 of the Act into the code. It will give the authority jurisdiction to develop proportionate and targeted rules to address any competition-related problems arising from the involvement of distributors or Transpower in other contestable markets if they emerge. It is more appropriate that these statutory provisions are in the code because the rapidly evolving electricity system requires more flexible and responsive regulation than would be the case if the rules remained in primary legislation. In closing this bill will ensure the electricity regulatory system is more future fit in light of significant changes occurring in the industry. I commend the bill to the House.ASSISTANT SPEAKER (Ian McKelvie): The question is that the motion be agreed to.