Electricity Supply Industry Amendment Act 1998

Electricity Supply Industry Amendment Act 1998

An Act to amend the Electricity Supply Industry Act 1995

Be it enacted by His Excellency the Governor of Tasmania, by and with the advice and consent of the Legislative Council and House of Assembly, in Parliament assembled, as follows:

1.   Short title

This Act may be cited as the Electricity Supply Industry Amendment Act 1998 .

2.   Commencement

(1)  Section 5 commences on a day to be proclaimed.

(2)  The remaining provisions of this Act commence on the day on which this Act receives the Royal Assent.

3.   Principal Act

In this Act, the Electricity Supply Industry Act 1995 is referred to as the Principal Act.

4.    Section 3 amended (Interpretation)

Section 3 of the Principal Act is amended as follows:

(a) by inserting the following definitions after the definition of authorised officer :

Code means the Tasmanian Electricity Code, as amended or substituted from time to time, issued by the Regulator under Division 9 of Part 3 ;

comply with includes not contravene;

(b) by inserting the following definitions after the definition of low voltage :

National Electricity Code means –

(a) the code of conduct, called the National Electricity Code, approved by the Ministers of each of the States of New South Wales, Victoria, Queensland and South Australia for the time being in accordance with section 6(1) of the National Electricity Law; or

(b) if that code is amended in accordance with its terms and that Law, that code as so amended;

National Electricity Law means the National Electricity Law agreed to be enacted by the States of New South Wales, Victoria, South Australia and Queensland and the Australian Capital Territory pursuant to an agreement between those jurisdictions made on 9 May 1996, being the schedule (as amended from time to time) to the National Electricity (South Australia) Act 1996 of South Australia;

(c) by omitting the definition of non-contestable customer and substituting the following definition:

non-contestable customer means –

(a) if a limit has been prescribed for the purposes of the definition of "contestable customer", a customer of an electricity entity whose electricity consumption, or rate of consumption, does not exceed that limit; and

(b) if no such limit has been prescribed, a customer of an electricity entity;

(d) by inserting the following definition after the definition of public land :

regulations means regulations made and in force under this Act;

(e) by omitting the definition of reviewable decision and substituting the following definitions:

reviewable decision means any direction, decision or determination under this Act, the regulations or the Code other than a direction, decision or determination declared by this Act or the Code not to be reviewable;

subsidiary has the same meaning as in the Corporations Law;

(f) by omitting the definition of tariff and substituting the following definition:

tariff means a schedule setting out prices and conditions for the sale of electricity to customers generally or the various classes of customers, as amended from time to time;

5.    Section 5 amended (The Regulator)

Section 5 of the Principal Act is amended by omitting subsection (2) and substituting the following subsection:

(2)  The Commissioner, within the meaning of the Government Prices Oversight Act 1995 , is the Regulator.

6.    Section 6 amended (Regulator's functions and powers)

Section 6 of the Principal Act is amended as follows:

(a) by inserting the following paragraph after paragraph (c) in subsection (1) :

(ca) to issue, maintain, administer and enforce the Code; and

(b) by omitting from subsection (1)(d) "Act." and substituting "Act, the regulations and the Code.";

(c) by inserting in subsection (2)(c) "security," after "safety,";

(d) by inserting the following subsection after subsection (2) :

(3)  The Regulator has power to do all things necessary or convenient to be done in connection with, incidental to or related to the performance and exercise of the Regulator's functions and powers.

7.    Section 7 repealed

Section 7 of the Principal Act is repealed.

8.    Section 8 substituted

Section 8 of the Principal Act is repealed and the following section is substituted:

8.   Administrative fairness and independence

(1)  In exercising powers and functions under this Act, the Regulator must not unfairly discriminate between electricity entities, customers for electricity or other persons.

(2)  In exercising powers and functions under this Act, the Regulator is not subject to the direction of the Minister or any other person.

9.    Section 10 amended (Regulator's annual report)

Section 10(2) of the Principal Act is amended by omitting "under the Regulator's official charter" and substituting "by the Minister".

10.    Section 19 amended (Consideration of application)

Section 19 of the Principal Act is amended as follows:

(a) by omitting paragraph (b) from subsection (2) ;

(b) by inserting the following paragraph after paragraph (f) in subsection (2) :

(fa) in the case of a licence authorising retailing of electricity in all of Tasmania other than King Island, Flinders Island and any prescribed area –

(i) the applicant is not a generator of electricity that has a substantial degree of market power in the Tasmanian market for the generation of electricity; and

(ii) no subsidiary of the applicant or related person is a generator of electricity that has a substantial degree of market power in the Tasmanian market for the generation of electricity; and

(iii) the applicant, its subsidiaries and its related persons are not, when taken together, generators of electricity that have a substantial degree of market power in the Tasmanian market for the generation of electricity; and

(c) by inserting the following subsection after subsection (2) :

(2A)  For the purposes of subsection (2)(fa) , a person is related to the applicant electricity entity if –

(a) the person is related within the meaning of the Corporations Law; or

(b) the Regulator considers that for the purposes of that subsection the person is otherwise related to the applicant electricity entity.

11.    Section 22 amended (Conditions of licence)

Section 22 of the Principal Act is amended as follows:

(a) by omitting subsection (1) and substituting the following subsection:

(1)  A licence is subject to the following conditions:

(a) conditions determined by the Regulator on the issue of the licence;

(b) a condition that the electricity entity must comply with standards, codes and requirements stated in the licence or prescribed by regulation;

(c) a condition that the electricity entity must comply with the relevant regulations;

(d) a condition that the electricity entity must comply with the provisions of the Code, other than any provisions specifically exempted from the operation of this paragraph in the licence;

(e) a condition that the electricity entity must comply with –

(i) directions or requirements given or made by the Regulator under this Act, the regulations or the Code; and

(ii) system control directions given under this Act, the regulations or the Code;

(f) a condition that the electricity entity must comply with –

(i) any award made under the Electricity Ombudsman Act 1998 ; and

(ii) any decision of any court in respect of a matter that could have been the subject of a complaint under the Electricity Ombudsman Act 1998 or resulted from proceedings commenced on the recommendation of the Ombudsman under that Act; and

(iii) any decision of any tribunal, board or other person in respect of a matter that could have been the subject of a complaint under the Electricity Ombudsman Act 1998 or resulted from the referral of that matter to the tribunal, board or other person by the Ombudsman under that Act;

(g) a condition that the electricity entity must pay periodic and other fees and charges fixed by or in accordance with the licence;

(h) in respect of a licence authorising the transmission, distribution or retailing of electricity, a condition that the electricity entity cannot use any prescribed expression or logo or any expression or logo of a prescribed class –

(i) as part of the trading name of the entity; or

(ii) in any way to promote the entity or its products;

(i) a condition that the electricity entity become a member of any relevant prescribed body.

(b) by omitting from subsection (2) " subsection (1) (d) " and substituting " subsection (1) ";

(c) by omitting from subsection (2)(a)(i) "a national code regulating conduct in the electricity supply industry" and substituting "the provisions of the National Electricity Code specified in the licence";

(d) by omitting from subsection (2)(a)(ii) "national code" and substituting "National Electricity Code".

12.    Section 35 amended (Remuneration of system controller)

Section 35(2) of the Principal Act is amended by omitting "regulations" and substituting "Code".

13.    Section 38 amended (Tariffs)

Section 38 of the Principal Act is amended as follows:

(a) by omitting subsections (1) and (2) and substituting the following subsections:

(1)  An electricity entity that has an exclusive right under its licence to sell electricity to non-contestable customers within a particular supply area must fix a tariff.

(2)  An electricity entity may amend its tariff or rescind its tariff and fix a new tariff.

(b) by omitting subsection (4) and substituting the following subsections:

(4)  A tariff and any amendment to a tariff –

(a) must be consistent with this Act, the regulations, the Code and any order or limitation on the price of electricity imposed under a law of the State dealing with price regulation; and

(b) must comply with any form, procedure or condition specified in the regulations; and

(c) if the regulations require the approval of a draft tariff or draft amendment to a tariff before the tariff or amendment is made, must be in the same terms as the draft tariff or draft amendment.

(5)  In fixing or amending a tariff, the electricity entity must comply with the procedures, principles and conditions set out in the regulations.

(6)  A tariff or an amendment to a tariff takes effect on the day specified in the tariff or amendment.

(7)  If the regulations require that a draft tariff or draft amendment to a tariff must be approved as specified in the regulations, a tariff or an amendment to a tariff that is not in the same terms as an approved draft tariff or approved draft amendment is of no effect.

14.    Section 39 amended (Publication of tariffs)

Section 39(1) of the Principal Act is amended as follows:

(a) by omitting "an electricity" and substituting "a";

(b) by omitting from paragraph (b) "changes." and substituting "changes; and";

(c) by inserting the following paragraph after paragraph (b) :

(c) comply with any further requirements relating to the publication of the tariff specified in the Code.

15.    Section 39A inserted

After section 39 of the Principal Act , the following section is inserted:

39A.   Contractual relationship based on tariff

If –

(a) a person purchases or agrees to purchase electricity from an electricity entity; and

(b) a tariff is in force in respect of that sale of that electricity; and

(c) terms and conditions have not been negotiated under section 40 in respect of that sale –

the tariff, as amended or replaced at the relevant time, and any regulations placing obligations on the electricity entity or that person that are in force at the relevant time, form a contract in respect of the sale of the electricity to that person.

16.    Section 42 amended (Disconnection of supply for non-payment)

Section 42 of the Principal Act is amended as follows:

(a) by omitting from subsection (1) " subsection (2) ," and substituting " subsections (1A) and (2) ,";

(b) by inserting the following subsection after subsection (1) :

(1A)  An electricity entity must not disconnect an electricity supply under this section if that supply is a prescribed service.

17.    Part 3, Divisions 9 and 10 inserted

After section 49 of the Principal Act , the following Divisions are inserted in Part 3:

Division 9 - Tasmanian Electricity Code

49A.   Tasmanian Electricity Code

(1)  The Regulator must issue the Tasmanian Electricity Code.

(2)  The Code may provide for any matter relating or incidental to the regulation of the electricity supply industry.

(3)  Without limiting subsection (2) , the Code may make provision with respect to the following matters:

(a) the regulation of electricity markets;

(b) dispute resolution;

(c) electricity system operation and electricity system security;

(d) metering;

(e) connection to the distribution and transmission systems;

(f) supply and sale of electricity to non-contestable customers;

(g) safety and environmental codes of practice;

(h) generation, transmission, distribution and retail pricing principles;

(i) access to electricity infrastructure;

(j) whether any direction, decision or determination under this Act, the regulations or the Code is not a reviewable decision;

(k) the establishment of tribunals and committees for the purposes of the Code;

(l) principles on which the Regulator is to base any direction, decision or determination under this Act, the regulations or the Code;

(m) principles for the separation of accounts and functions within electricity entities;

(n) the enforcement of tariffs;

(o) amendment, revocation and substitution of the Code;

(p) administration of the Code;

(q) enforcement of the Code;

(r) any other prescribed matter.

(4)  The Code must be consistent with this Act, the regulations and the public interest.

(5)  If there is an inconsistency between the Code and this Act or the regulations, the Code is invalid to the extent of the inconsistency.

(6)  The Code may be made so as to apply differently according to matters, limitations or restrictions, whether as to time, circumstance or otherwise, specified in the Code.

(7)  The Code may authorise any matter to be from time to time determined, applied or regulated by –

(a) the Regulator; or

(b) a tribunal or committee established under the Code or this Act; or

(c) the system controller.

(8)  The Code may adopt either wholly or partly and with or without modification, and either specifically or by reference, the National Electricity Code or the National Electricity Law.

49B.   Review, amendment and replacement of Code

(1)  The Regulator may review the Code –

(a) at his or her discretion; or

(b) on the request of any person.

(2)  The Regulator must review the Code when required to so do by the Minister.

(3)  The Regulator may amend or rescind and substitute the Code as specified in, and in accordance with, the Code.

49C.   Availability of Code

(1)  The Regulator must provide a person with a copy of the Code or part of the Code if the person –

(a) requests it; and

(b) pays to the Regulator any reasonable fee determined by the Regulator.

(2)  The Regulator, free of charge, must allow a person to peruse the Code at the office of the Regulator at any time within the hours during which that office is normally open.

49D.   Scrutiny of Code by Parliamentary Standing Committee on Subordinate Legislation

(1)  Within 14 days after issuing the Code or an amendment to the Code, the Regulator must provide a copy of the Code or amendment to the Parliamentary Standing Committee on Subordinate Legislation.

(2)  The Parliamentary Standing Committee on Subordinate Legislation may recommend to the Regulator, in writing, that the Code be amended.

49E.   Application of Code to persons other than electricity entities

(1)  The Code may provide for the registration as participants of persons, other than electricity entities, that intend to participate in the electricity supply industry.

(2)  A person registered as a participant must comply with the relevant provisions of the Code and any direction, decision or determination of the Regulator under the Code.

(3)  The Regulator may cancel the registration of a participant if the Regulator finds that the participant has failed to comply with the relevant provisions of the Code or any direction, decision or determination of the Regulator under the Code.

(4)  The Code may specify conditions that must be complied with –

(a) before a person can be registered as a participant; or

(b) before the registration of a participant can be cancelled.

Division 10 - Miscellaneous

49F.   Application of Trade Practices Act 1974 and the Competition Code

(1)  In this section –

Competition Code has the same meaning as in the Competition Policy Reform (Tasmania) Act 1996 ;

vesting agreement means an agreement –

(a) entered into by an electricity entity during June or July in 1998; and

(b) which, either before or after being entered into, has been approved by the Minister to be a vesting agreement.

(2)  For the purposes of section 51 of the Trade Practices Act 1974 of the Commonwealth and the Competition Code, this Act authorises an electricity entity –

(a) to supply and purchase goods and services in accordance with its licence, this Act, the regulations and the Code; and

(b) to enter into and perform vesting agreements; and

(c) to comply with obligations imposed by this Act, the regulations and the Code; and

(d) to exercise rights and powers given by this Act, the regulations, the Code and any vesting agreement entered into.

18.    Sections 114A and 114B inserted

After section 114 of the Principal Act , the following sections are inserted in Division 3 of Part 10:

114A.   Compliance with direction, determination and requirement of Regulator

(1)  An electricity entity must comply with any direction, determination or requirement given or made by the Regulator under this Act, the regulations or the Code.

Penalty:  Fine not exceeding 1 000 penalty units and, in the case of a continuing offence, a further fine not exceeding 100 penalty units for each day during which the offence continues.

(2)  If a court finds an electricity entity guilty of an offence against subsection (1) , it may in addition to, or instead of, imposing a penalty under that subsection make one or more of the following orders:

(a) an order requiring the electricity entity to comply with the direction, determination or requirement of the Regulator;

(b) an order directing the electricity entity to do or refrain from doing anything;

(c) such other order as the court considers appropriate.

114B.   Compliance with licence conditions

(1)  An electricity entity must comply with the conditions to which its licence under this Act is subject.

Penalty:  Fine not exceeding 1 000 penalty units and, in the case of a continuing offence, a further fine not exceeding 100 penalty units for each day during which the offence continues.

(2)  If a court finds an electricity entity guilty of an offence against subsection (1) , it may in addition to, or instead of, imposing a penalty under that subsection make one or more of the following orders:

(a) an order requiring the electricity entity to comply with the conditions to which its licence under this Act is subject;

(b) an order directing the electricity entity to do or refrain from doing anything;

(c) such other order as the court considers appropriate.

19.    Part 10, Division 4: Heading amended

Division 4 of Part 10 of the Principal Act is amended by inserting in the heading to that Division "and provisions relating to proceedings in a court" after "provisions".

20.    Section 116A inserted

After section 116 of the Principal Act , the following section is inserted in Division 4 of Part 10:

116A.   Regulator may take court action on behalf of customer

Where a customer or a class of customer could take any action in a court to enforce a right under, or to enforce compliance with, this Act, the regulations or the Code, the Regulator may in his or her discretion take that action on behalf of the customer or class of customer.

21.    Section 122 amended (Regulations)

Section 122 of the Principal Act is amended by inserting after subsection (2) the following subsections:

(2A)  Without limiting subsection (1) , the regulations may provide for –

(a) investigations by the Regulator into the pricing policies of electricity entities; and

(b) the making by the Regulator of orders setting the maximum prices that may be charged by electricity entities for the supply of electricity and ancillary services; and

(c) the functions and powers of the Regulator with relation to such investigations and the making of such orders; and

(d) the appointment of assistants to the Regulator for the purposes of carrying out such investigations; and

(e) the power of the Regulator and such assistants to delegate any functions and powers specified in the regulations with relation to such investigations; and

(f) the liability of electricity entities for the costs incurred in undertaking such investigations and making such orders; and

(g) any related matter.

(2B)  If the regulations provide for the making by the Regulator of orders setting the maximum prices that may be charged by electricity entities for the supply of electricity and ancillary services –

(a) those orders are statutory rules within the meaning of the Rules Publication Act 1953 ; and

(b) the Treasurer may not declare such an order to be subordinate legislation under section 3(2) of the Subordinate Legislation Act 1992 .

(2C)  Without limiting the generality of subsection (1) , the Governor may make regulations that contain provisions of a savings or transitional nature consequent on the commencement of any one or more of the following:

(a) the Electricity Supply Industry Amendment Act 1998 ;

(b) the Government Prices Oversight Amendment Act 1998 ;

(c) regulations providing for any matter specified in subsection (2A) .

(2D)  A regulation of a kind referred to in subsection (2C) may take effect on and from the day on which the Act or regulations to which that regulation relates commences or takes effect or on and from a later day.

[Second reading presentation speech made in:

House of Assembly on 26 MAY 1998

Legislative Council on 9 JUNE 1998]