A new regulatory framework will commence soon
The Water Industry Competition Amendment Act 2021 (Amending WIC Act) was passed by Parliament on 1 November 2021. The Amending WIC Act includes significant changes to the Water Industry Competition Act 2006 (WIC Act).
We are currently working with the Department of Planning and Environment (DPE) to prepare a revised Water Industry Competition (General) Regulation (WIC Reg) to implement the changes
The Amending WIC Act and new WIC Reg are expected to commence together in the second half of 2023.
Operator and retailer licences will become state-wide, not scheme specific
The new framework will make the following significant changes to the licensing structure under the WIC Act:
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There will be new state-wide operator and retailer licences, and separate approvals to construct and operate each scheme. Licences will be approved by the Minister and approvals by IPART.
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The operator licence will authorise the licensee to construct and operate certain types (classes) of water industry infrastructure and will specify the maximum number and scale of the authorised schemes.
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A retailer licence will authorise the sale of water and sewerage services for schemes supplying services to small retail customers (i.e. residential or small business customers) and will specify the maximum scale of the authorised schemes.
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Each scheme will have a separate scheme approval which authorises construction of a scheme by a registered operator.
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The scheme approval will specify the area of operations, the location of infrastructure, the class and design capacity of infrastructure, and the purpose and staging of the infrastructure.
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The registered operator will need an operational approval to start operating the scheme once it has been constructed.
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Licences and approvals can be varied, for example if an operator seeks to change the class, number, or scale of schemes or infrastructure it is authorised to construct and operate.
Last resort arrangements will now be required for essential services
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A last resort provider will be designated by the Minister to step in to provide an essential service should the licensed operator or retailer fail (e.g. because of insolvency).
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Contingency plans will be prepared by either the last resort provider or the essential service provider (i.e. licensee) to assist the last resort provider to step in to replace the failed operator or retailer in a last resort event.
Other new provisions will help IPART protect customers
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A deemed customer contract will apply to small retail customers and ensure a standard level of service and customer protection is provided, similar to Sydney Water’s and Hunter Water’s standard customer contracts.
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IPART will have expanded auditing, reporting and investigatory functions as well as increased investigative powers and penalties for offences.
Changes are expected to commence in 2023
We are already preparing for the changes to the WIC Act framework:
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Until 3 July 2023, we are seeking comment on our proposed new application forms and guides for retailer and operator licences, scheme approvals and operational approvals.
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We have consulted with stakeholders on a new fee structure and will finalise this shortly.
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We have consulted with stakeholders on our Scales Guide and Design Capacity Guide which can be used by applicants to identify the appropriate design capacity and scales of infrastructure or services in their licence or scheme approval applications.
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We are developing processes to provide for a smooth transition to the new framework for existing licensees.
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Some existing schemes will no longer need a WIC Act licence and will be regulated by local councils under the Local Government Act 1993 in future. We will work with the affected councils and licensees to hand over these schemes.
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Schemes continuing to be regulated under the WIC Act will be transitioned to the new licences and approvals over a 12-month transition period once the new framework commences.
Please subscribe to the water industry IPART updates if you would like to receive email notifications relating to changes to the WIC Act regulatory framework. You will also receive notifications related to WIC Act, WIC Regulation, licence applications made under the WIC Act, Public Water Utilities, and issues related to water pricing.
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