Utilities: Whats Essential

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• Utilities Whats Essential?
• Consumers and Representation in Essential Service
  Markets
• Tenants Advice Service State Conference
• by
• WACOSS Consumer Utilities Project
• Sue Ash
• CEO - WACOSS
• December 2008

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• Summary of Presentation
• WACOSS and the Consumer Utilities Project
• Essential services and utilities hardship
• Changes in essential service markets and
  regulation
• Adequacy of the consumer protection framework for
  essential services
• Representation, redress and advocacy for
  essential service consumers.

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• WACOSS
• and the
• Consumer Utilities Project

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• About WACOSS
• WACOSS and its members share a vision of a
  socially just and sustainable Western Australian
  society where all people have access to the
  resources and opportunities necessary for their
  wellbeing.
• We operate the Consumer Utilities Project as a
  part of our core policy and advocacy work.

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• Consumer Utilities Project
• Since 2005
• 1. Providing information, education and training
  regarding utility issues
• 2. Supporting consumer representation in
  decision- making processes regarding utility
  issues
• 3. Researching issues affecting utility
  consumers
• 4. Developing policy and advocate on behalf of
• utility consumers and
• 5. Facilitating partnerships between
  stakeholders in utility service provision.

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• Principles for Essential Services
• WACOSS has adopted a Charter of Principles
• for energy and water
• - sustainable
• - accessible
• - affordable
• - appropriate
• - accountable

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• WACOSS Policy
• WACOSS asserts the right of all consumers to be
  guaranteed access to essential services
  regardless of an incapacity to pay.
• Or in other words
• WACOSS does not support the disconnection of
  access to essential services due to a customer
  being in financial hardship.

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• Essential Services
• Utilities Hardship

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• ESSENTIAL SERVICES
• Effects of Disconnection or Restriction
• Physical and Mental Health
• Education and Employment
• Social Exclusion isolation
• Worsened financial situation

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• ESSENTIAL SERVICES
• Evidence indicated the importance of ensuring
  access to low income households to essential
  utilities such as electricity, gas, water and
  telephone services. Those services provide the
  basic means by which any household is able to
  function in a modern society.
• - Senate Poverty Inquiry 2004

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• ESSENTIAL SERVICES
• Reliable, affordable and sustainable energy
  services are critical to Australias economic and
  social wellbeing they are essential for
  supporting basic quality of life
• - Productivity Commission 2005

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• Utilities Hardship
• The Committee believes that the tabling of the
  petition in the Legislative Council, raised
  awareness within Government of Consumer Utilities
  Hardship as an issue requiring a concerted policy
  response, and that the Committees inquiries into
  the petition helped influence the Minister for
  Energys decision to establish the Interagency
  Working Group
• - Finding 1
• Report of the Standing Committee on Environment
  and Public
• Affairs in Relation to a Petition on Consumer
  Utilities Hardship in WA
• April 2008

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• Changes in
• Essential Service
• Markets

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Consumer Protection Framework
UTILITY CONSUMER PROTECTION
GENERIC REGULATION
Trade Practices Act (Cwth)
Fair Trading Act (WA)
INDUSTRY-SPECIFIC REGULATION
Retail Licenses
Industry Codes/Standards
Customer Charters
Company Policies
ENERGY OMBUDSMAN STATE OMBUDSMAN
ECONOMIC REGULATION AUTHORITY
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• Whats Changing
• The operation, ownership and regulation of
  essential
• service markets is constantly changing
• - Privatisation of Alinta
• - Disaggregation of Western Power
• - Development of Energy Ombudsman
• - Legislative Regulatory reviews
• - Policies and Charters
• - Pricing

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• Utility Pricing Now and in the Future

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• Adequacy of
• Consumer Protection Framework
• A Contested Debate

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• Consumer Protection Generalist
• Fair Trading Act (WA)
• Misleading information
• Bait advertising
• Warranties
• Product safety
• Trade Practices Act (Commonwealth)
• Misleading and deceptive conduct
• Unconscionable behaviour
• Harassment and coercion in sales
• Limited capacity to deal with systemic issues

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• Consumer Protection
• Industry Specific
• Code of Conduct (Electricity Industry Act 2004)
• Gas Marketing Standard (formerly Code)
• Customer Charters (water, gas, electricity)
• Energy Ombudsman (electricity, gas)
• Hardship policies (various)

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• Electricity Code of Conduct
• Code of Conduct is currently undergoing review
• Review every two years
• Review conducted by Electricity Consumer
  Consultative Committee (ECCC)
• ECCC comprised of
• 3 Consumer Representatives
• 3 Industry Representatives
• 2 Members from Government Agencies
• Public Consultation Period Feb-March 09

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• Gas Customer Protection Developments in WA
• New Gas Marketing Code of Conduct proposed by the
  Economic Regulation Authority (ERA).
• Content of Code parallel to Electricity Code.
• Final Draft expected to be finalised approx. Dec
  2008
• Implementation expected approx mid 2009.
• Alinta required to have Financial Hardship Policy
  under new Code.
• WACOSS working with Alinta to develop hardship
  policy.

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• Water Services Legislation
• Draft Water Services Bill
• Sets regulatory framework for water service
  providers
• Introduces necessary water reform
• Proposed Water Ombudsman Scheme
• Postponed due to new Government
• Implementation not expected now
• until 2010

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• UTILITY HARDSHIP AND CREDIT MANAGEMENT POLICIES
• Why we need regulated hardship policies
• Complement the rest of the regulatory framework
• Provide clarity and certainty for consumers
• Enable businesses to differentiate above minimum
  standards
• Synergy and Horizon Power are required to
  maintain hardship policies
• Water Corporation has recently developed a policy
• Alinta does not currently have a public policy

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• Dispute Resolution
• Internal External
• WACOSS supports independent schemes like the
  Energy Ombudsman for resolving disputes
• Coming to a mutually acceptable arrangement
• Collect customer information
• Consider capacity to pay
• Contact Essential Service Retailer
• If necessary, take the issue higher

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• Hardship Utility Grant Scheme (HUGS)
• Commenced on the 4th August 2008
• Part of the State Governments response to
  Utility Hardship
• Assist utility consumers in financial hardship
• Prevent utility disconnection
• Improve access to utilities through
• financial counselling

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• 1800 HUGS Hotline
• Recognition that people living in regional areas
  may not have easy access to a financial
  counsellor
• Not all metro utility consumers may have access
  to a financial counsellor
• Physical access issues disability mental
  health may prevent people from accessing a FC
• Gather relevant data to inform HUGS design

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• Why WACOSS?
• Previous role in utility policy advocacy through
  CUP
• Role in the NGO social service sector
• Its a pilot scheme
• Many unknowns remain
• Reducing risk for the sector

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• Representation, Redress Advocacy for Essential
  Service Consumers
• Its Essential!

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• Consumer Advocates
• Why we need them
• Personal
• Financial Hardship
• Health Status
• Disability
• Relationship or Family Problems
• Discrimination
• Systemic
• Complexity of markets
• Lack of awareness of rights and responsibilities
• Relevance of experience to market effectiveness
• Representation in decision making

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• Consumer Advocates
• More than just being there
• Independent advice
• Advocate for consumers on a variety of levels
• Assist consumers in negotiating existing consumer
  protection framework
• Identify systemic issues

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• Systemic Advocacy
• Complexity of markets
• The AER may develop a DMIS to provide incentives
  for DNSPs to
• implement efficient non-network alternatives, or
  to manage the
• expected demand for standard control services in
  some other way.
• The NER require that the AER, in developing and
  implementing a
• DMIS, have regard to
• the need to ensure that benefits to consumers
  likely to result
• from the scheme are sufficient to warrant any
  reward or penalty under
• the scheme for DNSPs.
• AER Report, October 2008
• DMIS, Energex, Ergon Energy and ETSA Utilities
  201015

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• Consumer Advocacy Panel
• In March 2008, the Consumer Advocacy Panel
  advised stakeholders that it had invited
  consultants to submit proposals to provide advice
  on the major classes of consumers in the NEM and
  their interests. The purpose of the project was
  to identify the major consumer classes, their
  interests and current involvement in market
  issues, and any gaps or overlaps in advocacy in
  order that the Panel can consider how its funding
  budget ought to be allocated in order to best
  promote the interests of consumers.

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• Systemic Advocacy
• Representation in decision making
• Examples of Government Consultation Processes
  request for consumer input
• The Office of Energys draft Recommendations
  Report and the Frontier Economics draft
  recommendations report
• ERA Call for Submissions on Draft Electricity,
  Gas and Water Industry Licensing Compliance
  Policy
• 75 similar notices since June 2008, 14 calling
  for public input to submissions or inquiries

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• Housing
• WACOSS continues to advocate for better housing
  outcomes through the annual Pre-Budget Submission
  as well as by being actively involved in the
  Creating Room in the Boom Campaign.
• WACOSS PBS available on website
  www.wacosscampaigns.org

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• Housing cont.
• Housing is a fundamental human need and a human
  right.
• WACOSS asserts that the State Government must
  address affordability, the shortfall in social
  housing, the need for more crisis and supported
  accommodation, tenants rights and the housing
  needs of vulnerable groups.

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• Housing cont.
• WACOSS recommends that the State Government
  improves tenants rights by introducing or
  expanding legislative protections with respect to
  rental tenancies more generally. 

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• Housing cont.
• This would include
• Amending the Act to regulate the operation of
  residential tenant databases.
• Amending the Act to protect tenants from no-cause
  evictions.
• Amending the Act to prohibit option fees.
• Amending the Act to provide protections for
  boarders and lodgers.

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• Housing cont.
• For further information please contact WACOSS
  Social Policy Unit 08 9420 7222

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• THANK YOU
• QUESTIONS?