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Licence Compliance
The Tribunal monitors licence compliance by various means including:
- Periodic self exception reporting
- Compliance audits
- Energy and Water Ombudsman's complaints (see Memorandum of Understanding below)
- Industry complaints
- Media reports
Periodic self exception reporting
To facilitate the common administration of the electricity and gas regimes, the Tribunal has produced a series of reporting manuals, one for each licence and authorisation type. These explain the Tribunal's approach to compliance monitoring and clarify reporting requirements for holders of NSW licences/ authorisations. The Electricity DNSP Reporting Manual was amended on 5 December 2007. The Electricity Retail Supplier Reporting Manual and the Electricity Standard Supplier Reporting Manual were amended on 22 November 2007.
Compliance audits
General Compliance Audits - Energy Retailers
The Tribunal will conduct periodic compliance audits. The scope and timing of these will depend on the results of previous compliance audits and each business's licence compliance history. Compliance audits will generally combine systems and performance audits.
New licensees may also be audited in the first twelve months of operation to confirm that necessary systems have been established to ensure licence compliance.
Audits of design, reliability and performance licence conditions - electricity DNSPs
Pursuant to Ministerially-imposed design, reliability and performance licence conditions, DNSPs are required to conduct an independent audit and provide an audit report to the Minister and to IPART by 30 September of each year commencing 30 September 2007.
DNSPs are required to nominate an auditor by notice in writing to the Tribunal by 1 July each year, commencing 1 July 2007. To assist DNSPs with nomination of an auditor and the arrangement of their audits, the Tribunal has prepared Audit Guidelines.
Harmonisation of Compliance Audit Approach with Interstate Regulators
The Essential Services Commission of Victoria, the Essential Services Commission of South Australia, the ACT Independent Competition and Regulatory Commisssion and the Independent Pricing and Regulatory Tribunal of NSW have agreed on an inter-jurisdictional approach to compliance audits in the energy retail sector. The following open letter outlines the approach:
Annual Compliance Reports
The Tribunal is required to report to the Minister by 31 October each year on licence compliance by electricity distributors and retail suppliers. The report is publicly released after being tabled in Parliament. Copies of these reports are available below:
Energy and Water Licence Compliance Policy
(published March 2005)
This policy covers the licensing of electricity, gas and water industries in NSW. It is not a legally binding document, but is designed to provide guidance to licence and authorisation holders on:
- how the Tribunal intends to investigate compliance information;
- procedures to be followed prior to enforcement action being taken;
- factors to be considered by the Tribunal when deciding if enforcement action should be taken; and
- what form any enforcement action may take.
The policy does not include detailed compliance monitoring and reporting functions, as these are covered by section 87 of the Electricity Supply Act 1995 and section 75A of the Gas Supply Act 1996. The policy also does not cover use of incentive reporting arrangements under the Tribunal's energy reporting manuals.
The Tribunal will follow the procedures outlined in this policy when investigating compliance matters and when considering taking enforcement action. It may depart from these procedures if intending to resolve a compliance matter by means other than by enforcement.
The Tribunal may respond to an energy compliance issue by increasing the frequency of reporting for a particular business. The Tribunal's use of compliance monitoring powers falls outside the scope of this policy, as do the Minister's separate enforcement powers.
Memorandum of Understanding between IPART & EWON
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