The ACCC is responsible for enforcing the Water Charge Rules.
The Water Charge Rules provide charging transparency for customers of monopoly water infrastructure operators in the Murray-Darling Basin. This transparency is achieved by requiring monopoly water infrastructure operators to include most charges on their schedule of charges. The Water Charge Rules also set limits on termination fees that may apply where an infrastructure operator’s customer chooses to terminate their access to the operator’s water service infrastructure.
The Water Charge Rules came into effect on 1 July 2020 and are based on advice provided by the ACCC to the Minister on 21 September 2016. The advice followed a consultation process, including opportunities for stakeholder comment through forums and the release of an issues paper, draft and final decisions.
To enhance pricing transparency, infrastructure operators are now required to provide more detail on their schedules of charges, and to provide customers with information on any termination fees they propose to charge. The old water charge rules were also consolidated into a single instrument.
The rule reform consultation highlighted stakeholder concerns with the clarity of the schedule of charges requirements in the old rules. The Water Charge Rules seek to improve clarity and transparency through a number of key changes.
Provide greater transparency in relation to each charge
For example, the infrastructure operator must provide the name of each charge, the amount of the charge or any details required to determine this, any available discount or surcharge and the circumstance in which it applies, and the class of person required to pay the charge.
Allow infrastructure operators more flexibility in providing notice of a schedule of charges to their customers
Under the Water Charge Rules if there is a delay in the release of a pricing decision of the ACCC or a state agency, an infrastructure operator can still set their charges as applying from the date of the regulatory decision, provided it gives its customers an updated schedule of charges as soon as practicable.
Provide improved transparency with respect to the pass-throughs of charges
The Water Charge Rules require that an infrastructure operator pass through charges in a transparent manner and set out how they should be presented on a schedule of charges.
The Water Charge Rules divide pass-through charges into network operation charges (mainly charges levied on an infrastructure operator for the purposes of meeting distribution losses) and ancillary charges (mainly government charges). Infrastructure operators do not have to levy a separate charge to recover network operation charges but if they do, they can recover no more than the charge they are passing through. To recover ancillary charges, infrastructure operators must levy one or more separate charges provided they only recover the same total amount of the ancillary charges.
Modify requirements for infrastructure operators in relation to seeking exemptions from the obligation to include a charge on a schedule of charges
Under the Water Charge Rules either infrastructure operators or their customers may apply to the ACCC for an exemption from the requirement to publish certain infrastructure charges on their schedule of charges, if the publication of the charge causes material financial loss or material detriment to the applicant. However, even where the ACCC grants the infrastructure operator or the customer an exemption from its schedule of charges publication requirements, it must publish certain information in relation to this exemption including: the name of the customer(s) and the infrastructure service to which the non-disclosure of the charge relates.
The Water Charge Rules restrict the maximum termination fee that an infrastructure operator can charge a customer terminating their water delivery right or drainage right. The restriction is intended to strike a balance between allowing a customer to terminate, and providing for the ongoing costs of the infrastructure operator.
The Water Charge Rules:
- restrict the maximum general termination fee that an infrastructure operator can levy to 10 times the fixed volumetric charges for the rights of access the customer wishes to terminate (levied per unit of water delivery or drainage right for a full financial year)
- if an infrastructure operator does not allow the trade of the kind of water delivery or drainage right that the customer wishes to terminate, the maximum general termination fee is the amount (not 10 times the amount) of the fixed volumetric charges for the rights the customer wishes to terminate (levied per unit of water delivery or drainage right for a full financial year).
The Water Charge Rules also require an infrastructure operator to provide the customer with a termination information statement before the customer terminates.
Schedule of charges
The ACCC has developed an example schedule of charges. This document is intended to demonstrate to stakeholders (in particular infrastructure operators and their water customers) the types of content that must be included in an infrastructure operator’s schedule of charges in specified circumstances under the new Water Charge Rules. However, it is not intended to be a template and the content of each infrastructure operator’s schedule of charges will depend on their particular circumstances.
The ACCC has developed an example termination information statement (TIS). This document is intended to demonstrate to infrastructure operators and their customers the types of content that must be included on a TIS under the Water Charge Rules. However, it is not intended to be a template and the content of each TIS will depend on the particular circumstances of the proposed termination.
You can send queries and complaints to: email@example.com