Endeavour Energy - Trial Waiver
The Australian Energy Regulator (AER) has granted its first trial waiver through the Energy Innovation Toolkit to upgrade around 5,600 smart meters in parts of Greater Western Sydney, the Blue Mountains, the Southern Highlands and the Illawarra region of NSW. Endeavour Energy has been granted the waiver to implement a trial that is expected to improve the delivery of load management services that reduce electricity consumption at peak periods and lower electricity network costs for consumers. The trial should also enable trial participants to access new and innovative energy services.
| Type: | Regulatory Sandboxing Trial Waiver |
| Sector: | Electricity |
| Segment: | Distribution |
| Status: | Decision Published - Trial Approved. Trial in progress. |
| Trial Period | 30 Months |
| Region: | New South Wales |
| Service provider: | Endeavour Energy |
| Contact: | regulatorysandbox@aer.gov.au |
Overview
The Australian Energy Regulator (AER) has granted its first trial waiver through the Energy Innovation Toolkit to upgrade around 5,600 smart meters in parts of Greater Western Sydney, the Blue Mountains, the Southern Highlands and the Illawarra region of NSW.
A copy of the final waiver decision document is linked below.
Endeavour Energy has been granted the waiver to implement a trial that is expected to improve the delivery of load management services that reduce electricity consumption at peak periods and lower electricity network costs for consumers.
The trial should also enable trial participants to access new and innovative energy services. The rollout of smart meter upgrades presents significant benefits for both consumers and industry. In addition, the trial can help consumers reduce their electricity bills through access to new products and tariffs, better integrated technology and improved understanding of their energy use.
The trial was approved under the AER’s regulatory sandboxing powers allowing a time-limited waiver from certain regulatory requirements through the Energy Innovation Toolkit, and is subject to a range of conditions including consumer protection measures, reporting requirements and other obligations.
Lessons learnt from Endeavour Energy’s trial will inform longer-term, necessary transitions and help other jurisdictions to accelerate the roll-out of smart meters. The trial will last for 30 months and the learnings will be shared publicly at the conclusion of the trial in 2025. The EIT may publish updates on trial progression throughout this period.
If you’re a participant in the trial, or if you’d like to know more about how the trial will affect consumers, see our Endeavour Energy trial consumer information page.
Endeavour currently services customers using controlled load hot water systems who have older meters which have no controlled load functionality. To operate the controlled load hot water systems for these customers, Endeavour use centralised network devices. These devices are at capacity or are at the end of their lives and need to be either replaced or augmented at a significant network cost. Endeavour have demonstrated that there is potential for significant network cost savings by replacing these customer’s meters with smart meters, instead of the costlier network augmentation and replacement.
Presently metering installations are the responsibility of the relevant retailer and its appointed metering coordinator. Endeavour as a distribution network service provider (DNSP) would not ordinarily have a role in the upgrading of metering installations to smart meters, but provisions exist for DNSPs to upgrade metering installations (after giving notice) where the meter in question is faulty. This is done through what is called the metering fault notification. Endeavour intends, through this trial, to issue a metering fault notification in relation to meters which are not registering a fault for the purpose of replacing these meters with smart meters.
The trial represents the continuation of a trial conducted during 2020-21 which involved transitioning approximately 2,850 customers in the Albion Park area to smart metering. This initial roll-out in 2020 was conducted as part of the AER’s Demand Management Incentive Scheme (DMIS) for 2019-2021. More information about this scheme can be found here.
Endeavour’s objective is to create a replicable “proof of concept” that addresses network constraints at the lowest overall cost while maximising customer benefits through accelerating the take-up of smart metering. The local distribution network operated by Endeavour will then utilise the collective load control functionality of these smart meters. Overall, Endeavour Energy considers the approach will help it to better manage the low voltage network to improve solar hosting, power quality and safety and reduce long-term investment.
On this basis and considering the potential benefits to be gained through a roll-out of smart meters at no cost to consumers, the AER granted Endeavour a waiver to conduct this trial.
To safeguard consumers, protect competition and ensure trial learnings, the AER has imposed a number of conditions on Endeavour as part of the trial waiver. These are set out in more detail in the final waiver decision document.
Waiver conditions address:
- Opt-out provisions. As a condition of the trial affected customers will be able to decline the installation of a type 4 smart meter and receive a non-communicating type 4A meter, a time clock, or to opt out of the trial and its associated meter upgrade entirely.
- Genuine meter failures. We have set a condition ensuring that the waiver will not apply in the case of a genuine metering fault, which would be remedied under existing replacement provisions.
- Competition. To ensure that the trial does not negatively impact the competitive market, we have included a condition requiring Endeavour to report to the AER on any request by a retailer of Trial Customers to engage metering coordinators appointed by those retailers via competitive processes. Endeavour must also agree to appoint these metering coordinators, provided they can provide services within the timeframes planned and for a cost agreed between parties, to be paid by Endeavour to participating retailers.
- Trial Reporting. Endeavour must provide regular reports to the AER at the following intervals and containing information set out at Table 1 on page 26 of the final decision document.
- The notice provided to customers. Endeavour must submit a draft of the notice to be provided by retailers to trial customers to the AER for our approval, prior to the granting of such notice. The notice will contain key information about the trial, including information about tariff changes, a link to the EIT trial information page for consumers, and information on how to contact the AER to discuss complaints or trial experience directly. The AER expects that retailers will adopt the recommendations or substantive drafting of the notice provided by Endeavour.
We have also included expectations for Endeavour and participating retailers in regard to customer engagement and life support customer support, to protect consumers and the energy network. This includes complying with life support provisions out under the National Energy Retail Rules (NERR) cl. 124B(1) and cl. 124B(2). The AER reserves all powers to take enforcement action against any breaches of existing notice and life support provisions not expressly covered by the waiver.
Key documents
Submissions (09 May 2023 - 19 June 2023)
Submissions closed on 19 June 2023. In total we received six written submissions. One of these was an accepted late submission.