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Victoria recently completed the rollout of 2.8 million smart meters across the state and NSW is set to follow on this path. In late October the NSW Government announced that electricity smart meters will be installed through a market-led rollout.
NSW Minister for Resources & Energy Anthony Roberts remarked:
“This is a case of allowing business to do what it does best, innovate and provide a product at competitive prices. It will be up to retailers to convince a customer of the benefits of having a smart meter and what it could offer them,” (Source: http://www.businessspectator.com.au/news/2014/10/28/energy-markets/nsw-back-voluntary-smart-meter-rollout)
We asked two key speakers from the inaugural Summer Energy Briefing (Darryl Biggar, Australian Competition and Consumer Commission (ACCC) and Andrew Dillon, Energy Supply Association of Australia) how applicable smart meters are to NSW and whether it will work. Here is what they had to say.
Darryl Biggar, Special Economic Advisor, Australian Competition and Consumer Commission (ACCC)
“My understanding is that NSW will not have a mandatory roll out of smart meters. Instead, the NSW Minister for Energy (Anthony Roberts) has announced (28 October 2014) that NSW will have a “market led” roll out. This means that customers will be free to choose whether or not to replace their existing meter with a smart meter provided by a third party. Customers may choose to do so for a variety of reasons, such as having the ability to take up new or innovative tariffs from a retailer. In some cases customers may install a smart meter to save on the costs of meter reading (most Smart Meters can be read remotely). AER has made special arrangements in the latest draft determination for NSW distribution businesses (released 27 November 2014) to allow metering services to be “contestable” – that is to allow businesses other than the DNSP to provide metering services, while ensuring that the distribution businesses are able to recover the costs of the existing meters. The AEMC currently has a rule change process underway to ensure that there is effective competition in metering services.
It is not clear how many NSW customers will choose to take up the possibility to install a smart meter in the first few years. That will depend on factors such as marketing campaigns from retailers, and the extent to which retailers can make an attractive offer (a “value proposition”) to customers. However, if new network pricing schemes are adopted it seems likely that smart meters will eventually seem attractive to many customers and over time, customers will choose to take up smart meters in relatively large numbers in NSW.”
Andrew Dillon, General Manager Corporate Affairs, Energy Supply Association of Australia
The rollout of smart meters in NSW (as well as other states) will be quite different from what occurred in Victoria. Future rollouts will not be mandatory and most customers will have to volunteer to get a smart meter. This will make the rollout slower but ensure smart meters are only rolled out to those who want them. One key learning from Victoria that is certainly applicable elsewhere is the need for an extensive communications and education campaign, to ensure consumers are aware of what is happening and empowered to make choices that suit them.
Darryl and Andrew will be sharing their expertise at the Summer Energy Briefing to be held on the 24-25 February at the Marriott Melbourne.