On 6 October 2004 SPI PowerNet Pty Ltd (SPI) advised the ACCC it was seeking a waiver from the ACCC’s Transmission ring-fencing guidelines. A supporting submission from SPI was received on 19 October 2004.
The guidelines require a transmission network service provider (TNSP) to ensure legal and operational separation of their transmission business from other related businesses. A related business under the guidelines includes the activities of generation, distribution and electricity retail supply.
SPI has applied for a waiver from clause 7.1(a)(ii) of the guidelines, which provides that a TNSP that supplies ring-fenced services must not carry on a related business. SPI proposes to carry on its transmission business and distribution business within a single business entity.
Under clause 11 of the guidelines, the ACCC may, by notice to the TNSP, waive any of the TNSP’s obligations under clause 7, provided the ACCC is satisfied that the benefit, or likely benefit to the public is outweighed by the administrative cost to the TNSP and its associates of complying with the obligation. SPI submits that the potential synergies of an integrated business will ultimately result in cost savings and benefits to consumers.
Notification of the application and a request for submissions was made on 8 October 2004. The following interested parties made submissions:
Victorian Energy Networks Corporation (VENCorp)
Essential Services Commission of Victoria (ESCV)
South Australian Department of Treasury and Finance.
The ACCC approved the release of the draft decision on 15 December 2004. A request for public submissions on the draft decision has been made and the closing date for submissions is 21 January 2005.
It is anticipated the final decision will be released in early March 2005.
On 27 August 2004 the ACCC received applications under s. 88 of the Trade Practices Act 1974 for authorisation of derogations to the code (Nos A90928–30). National Electricity Code Administrator (NECA) lodged the applications on behalf of the NSW Minister for Energy and Utilities. The application also included a request for interim authorisation.
The application relates to the arrangements for the supply of metering and metering-related services to small retail customers in NSW. The proposed derogations would make NSW distribution businesses exclusively responsible for metering service provision for those customers.
The application seeks authorisation of amendments to derogations contained in chapter 9 of the code. NSW has requested authorisation of extension of the metering exclusivity until 31 December 2006.
On 1 December 2004 the ACCC granted interim authorisation and released a draft determination which proposed to authorise the applications subject to a condition of authorisation. The effect of the draft determination would be that distribution businesses would continue to have exclusive responsibility for providing metering services to all small customers using types 5–7 metering installations. The proposed condition of authorisation stipulates that type 5 interval meters that are remotely read would be exempt from the derogation.
On 14 January 2005, following a request by Intermoco Solutions (a metering company) and EnergyAustralia, the ACCC held a pre-determination conference in Sydney, where interested parties made verbal submissions regarding the draft determination.
The ACCC expects to issue a final determination on the amendments to the derogations in early March 2005.
On 6 April 2004 the ACCC received applications for authorisations (Nos A90915–17) of amendments to the Victorian derogations from the National Electricity Code. These applications were lodged by the NECA on behalf of the Victorian Minister for Energy Industries and Resources.
The stated purpose of the applications is to extend the existing Victorian derogations contained in chapter 9 of the code. The existing derogations relate to chapter 7 of the code, and grant exclusivity to provide metering services for types 5–7 metering installations by distribution businesses in Victoria. Type 5 meters are manually read interval meters, type 6 meters are accumulation meters, and type 7 refers to unmetered supply.
On 1 December 2004 the ACCC released a draft determination which proposed to authorise the applications subject to a condition of authorisation. The effect of the draft determination would be that distribution businesses would continue to have exclusive responsibility for providing metering services to all small customers using types 5–7 metering installations. The proposed condition of authorisation stipulates that type 5 interval meters that are remotely read would be exempt from the derogation.
On 13 January 2005, following a request by Intermoco Solutions (a metering company), the ACCC held a pre-determination conference in Melbourne, where interested parties made verbal submissions regarding the draft determination.
The ACCC expects to issue a final determination on the amendments to the derogations in early March 2005.
On 4 January 2005 the ACCC received an application for a minor variation to the authorisation of Tasmania’s derogations from the National Electricity Code (Nos A90759–61). These applications were lodged by NECA.
Further amendments to Tasmania’s derogations are necessary due to changes to the code and other developments subsequent to the Tasmanian derogations being authorised in 2001. In particular, the authorised derogations require amendment to:
update the references and terminology to be consistent with the amended code and other instruments
delete a number of derogations which are now irrelevant
address some unforseen outcomes of changes to the code made as a result of the review of technical standards by the Reliability Panel.
The previously approved derogations have not, as yet, been gazetted by NECA pending determination of a firm starting date for Tasmania’s participation in the National Electricity Market. This is expected to be 29 May 2005 but is subject to confirmation by Tasmania.
On the basis of the application received from NECA, the ACCC is satisfied that the variation sought is a minor variation, in that it does not involve a material change in the effect of the authorisation.
Interested parties were invited to make submissions regarding the public benefits and anti-competitive detriments of the code change by 21 January 2004. The ACCC is expected to release its determination regarding the proposed minor variation in February 2005.
On 17 December 2004 NECA lodged an application for minor variation of the authorisations of the National Electricity Code by way of a derogation providing for:
a delay of the publication date of the statement of opportunities (SOO) from 31 July to 31 October
the removal of the obligation to publish a mid-year update to the SOO.
NECA proposed that the derogation apply for 2005 only.
The SOO provides information about the adequacy of electricity supplies in the National Electricity Market over the next ten years. The need for the code change arose because of the tight timeframe within which the SOO must be published.
The code change ensures there is adequate time for the preparation of the SOO. It also eliminates the costs of preparing a mid-year update to the SOO, which are disproportionate to the benefit of the update.
On the basis of the application from NECA, the ACCC is satisfied that the variation sought was a minor variation in that it did not involve a material change in the effect of the authorisations of the code. Interested parties were invited to make submissions regarding the public benefits and anti-competitive detriments of the code change by 7 January 2005. No submissions were received. The ACCC released its determination on 12 January 2005 approving the minor variations.
Under the terms of GasNet’s access arrangement for the Victorian transmission system, GasNet varies its tariffs each year in accordance with a price control formula.
On 12 January 2005 the ACCC approved the amended tariffs submitted by GasNet on 17 December 2004. The ACCC was satisfied that the price control formula and pass- through adjustments had been correctly applied under schedule 4 and clause 6 (respectively) of the access arrangement.
Although the ACCC had previously approved 2005 tariffs for GasNet on 8 December 2004, new tariffs were required following revisions to GasNet’s access arrangement which were approved by the ACCC on 15 December 2004.
Two access disputes relating to the declared mobile terminating access service were notified to the ACCC under Part XIC of the Trade Practices Act 1974. PowerTel Limited notified the ACCC of an access dispute with Optus Networks Pty Limited and Hutchison 3G Australia Limited notified the ACCC of an access dispute with Vodafone Network Pty Limited. These two access dispute notifications are in addition to the five access dispute notifications received for the mobile terminating access service in December 2004.
The ACCC has commenced the arbitration process for all of these access disputes.
The domestic mobile terminating access service is a wholesale input used by providers of fixed-to-mobile and mobile-to-mobile calls to allow their customers to call mobile phone users. It allows consumers (either fixed-line or mobile) to call mobile users connected to another network.
Primus Telecom Pty Limited notified the ACCC of an access dispute with Telstra Corporation Limited, under Part XIC of the Trade Practices Act. The access dispute relates to the monthly rental charge and other charges pertaining to the supply of the line sharing service (LSS) from Telstra to Primus.
The ACCC has commenced the arbitration process for this access dispute.
Line sharing refers to a situation where two separate carriers, or service providers, supply separate services to an end-user over a single copper or metallic pair (telephone line). Under line sharing, the metallic line is normally split (or shared) in a spectral sense so that one carrier or service provider provides the voice services over the line in question, while another carrier provides high-speed data services using its own DSL technology. The LSS was ‘declared’ under Part XIC of the Trade Practices Act in August 2002.
The ACCC sought written submissions from interested parties on whether to revoke its Part A competition notice in response to reductions by Telstra in its wholesale ADSL prices.
Since the ACCC issued the competition notice on 19 March 2004 there have been several developments which include Telstra revising its wholesale pricing and negotiating with wholesale customers. The most recent revision was notified to the ACCC to take effect from 1 January 2005, after which Telstra requested that the ACCC revoke the competition notice.
The ACCC is assessing the full impact of these changes on the level of competition among internet service providers to determine whether or not it has reason to believe that Telstra is currently engaging in anti-competitive conduct. The ACCC is not considering whether or not Telstra’s previous pricing was anti-competitive as part of this process.
The ACCC issued its final report on whether to declare an internet interconnection service concluding that internet interconnection arrangements should not be regulated at this time.
Internet interconnection allows customers—business, residential or others—that are connected to one internet network to send and receive emails, access websites and exchange information with users connected to other internet networks. Internet interconnection also enables business and other consumers to make the content they store on the internet accessible to other users.
The ACCC’s decision confirms its earlier draft finding that a case has not been made for regulation at this stage, but that there are sufficient concerns to warrant the implementation of a rigorous but carefully targeted monitoring program.
The details of the monitoring regime are being developed, taking into account industry concerns about such a program, and will be finalised early this year.
