The rules for energy billing in residential parks

If you live in a residential park, you need to be aware of what rules apply to how your electricity is billed. Authorised retailers have now taken over selling electricity in some residential parks, a job which used to be done by the park operators or billing agent. Learn more about what this means and what rules apply depending on who is selling the electricity.

What is the difference between an exempt seller and an authorised retailer?

In NSW, a person must not sell energy to another person in a premises unless they either hold a retailer authorisation from the Australian Energy Regulator (AER), or are an exempt seller. 

If you live in an embedded network like a residential park, you may have always paid your electricity charges directly to the residential park operator or their billing agent. In this situation, your energy is most likely being sold to you by an exempt seller. 

If you have been told that your electricity charges will now be billed by an energy retailer that also services a large number of other customers, or other embedded networks, it is very likely that this company will hold a retailer authorisation from the AER.

How do I find out who is selling me electricity? 

It can sometimes be complicated finding out who is actually selling your electricity. It is possible that an energy company might send you a bill, but they are acting as a billing agent for your park operator. If you are billed by a billing agent, your electricity bill must still include the legal name, trading name (if relevant) and contact details of the exempt seller. If it is still unclear who is selling you electricity, you can call the park operator, or the energy retailer and ask them who holds the retail account for the parent connection point of the embedded network. Only the person purchasing the energy at the parent connection point can be the energy seller. 

This information is important because authorised energy retailers and exempt sellers operate under two different sets of rules. It also means that Residential (Land Lease) Communities Act 2013 may no longer apply to the billing of your electricity account.

Read definitions of some key embedded network terms. 

Now that an energy retailer is billing my electricity, what rules apply?

If you pay for your electricity directly to an exempt seller, like a a residential park operator, they must follow a set of rules outlined in the Australian Energy Regulator’s (AER) guideline. If your electricity is billed by a residential park operator, they must also follow the rules for electricity charges set out in the Residential (Land Lease) Communities Act 2013. These rules also apply in any situation where a third-party billing agent is simply billing you on behalf of a park operator.

If your electricity account has now been taken over by an authorised energy retailer who is purchasing the energy at the parent connection point for your embedded network, then the rules for exempt sellers and the rules contained in the Residential (Land Lease) Communities Act 2013 will no longer apply.

Authorised retailers must instead follow the rules set out in the National Energy Retail Law (NERL) and the National Energy Retail Rules (NERR). You will find that many of the rules contained in the AER exempt selling guideline and the NERR are similar.

I live in a residential park. Why have my electricity charges changed, and why is the energy retailer not following the rules in the Residential (Land Lease) Communities Act 2013?

The Residential (Land Lease) Communities Act 2013 contains rules about how a residential park operator can charge residents for the use of electricity. These rules include:

• the amount that can be charged to residents for their electricity
• how a standing charge for service availability must be calculated.

EWON understands that the rules contained in the Residential (Land Lease) Communities Act only apply to situations where the resident’s site agreement stipulates that the homeowner is required to pay utility charges to the park operator. This would include any situation where a billing agent was acting on behalf of a park operator. 

If you have a dispute with a park operator about the terms of your residential site agreement, we recommend you contact your local Tenants' Advice and Advocacy Service.

However, in most situations, energy retailers are not park operators, and they are not operating the residential park. It therefore appears that the rules set out in the Residential (Land Lease) Communities Act do not apply to an authorised energy retailer purchasing electricity at the parent connection point for the park and selling that electricity to residents.

This means the energy retailer is not required to set a price for electricity use based on the provisions of the Residential (Land Lease) Communities Act. 

The NSW Supreme Court found in 2018 that a park operator does not have the right to charge a home owner more than the operator has been charged for electricity consumed by the home owner (footnote). However, this court decision is unlikely to apply to how an authorised energy retailer bills your electricity account. 

Does the energy retailer need permission to open an account for me?

Yes. The energy retailer must follow the rules set out in the National Energy Retail Law (NERL).

Section 38 of the NERL requires an energy retailer to obtain your explicit informed consent before you enter into a contract for the supply of energy. The retailer is required to keep a record of your explicit informed consent to enter into an energy contract.

What happens if I refuse to give my consent to open an account with the energy retailer?

If you refuse to open an account with an energy retailer, you will be at risk of having the supply of electricity to your home disconnected.

The National Energy Retail Rules (NERR) do provide the energy retailer with a disconnection process to follow if a customer is consuming energy without opening an account or refusing to pay for their energy use. If you think you are at risk of disconnection you can call us on 1800 246 545.

My park operator has stopped selling energy, but I don’t want to open an account with this energy retailer. Can I open an account with a different energy retailer?

Yes. You are allowed to transfer the billing of your electricity account to another energy retailer. 

However, this is a complicated process. You will first need to find an electricity retailer that can offer you an energy plan that is designed for an embedded network customer. 

We recommend you ask any new retailer about the potential costs of transferring out of the embedded network. The process of transferring to an electricity retailer outside of an embedded network will include the services of an Embedded Network Manager, who may need to replace your current electricity meter, and register your premises with the National Electricity Market. There may be costs associated with transferring out of an embedded network.

You will still be required to pay some network charges that are passed through to you from your embedded network operator from the licenced network operator supplying electricity to the parent connection point of the embedded network. 

I have been told that my home needs a new electricity meter. Do I have to pay for a meter upgrade?

Yes. An energy retailer is allowed to charge you for the upgrade to your electricity meter. There are no rules that cover how much a new electricity meter should cost and there are no rules that determine when a new meter is required.

If you have concerns about technology and health, you can find information on the Australian Radiation Protection and Nuclear Safety Agency website. 

I purchased a rooftop solar system for my home with the park operator’s permission. Does the energy retailer need to pay me a fair price for the electricity generated by my solar panels?

There is no legal requirement for any energy seller, whether exempt or authorised, to pay you for energy generated by your rooftop solar system and exported to the network.

Most energy sellers will try to accommodate customers who have purchased rooftop solar systems and provide you with a set Feed-In Tariff, credits for the energy you export, or even a rebate that is agreed between yourself and the energy seller.

If you have purchased a rooftop solar system, or you are considering purchasing a system, we recommend that you call your energy seller and negotiate an arrangement so that you can receive the full benefits of this system. 

Footnotes

Silva Portfolios Pty Ltd trading as Ballina Waterfront Village & Tourist Park v Reckless [2018] NSWSC 1343. Read more about the court decision.