The Australian Energy Regulator today issued a publication, Compliance and Enforcement – Statement of Approach.
"This publication explains the AER's enforcement obligations, the AER's approach to monitoring compliance with the rules, and the enforcement options available," AER Chairman, Mr Steve Edwell said.
"The AER aims to provide greater transparency about its compliance and enforcement program.This will assist market participants to understand their obligations and encourage compliance with the rules.
"In developing its approach, the AER undertook a comprehensive risk assessment. The AER reviewed each of the 1500 obligations in the rules and assessed the probability an obligation would be breached, and the impact any breach would be likely to have on the market.
"The AER has used this risk assessment to help determine which monitoring mechanism to use for each rule obligation, the intensity of monitoring, and the enforcement response where breaches are identified.
"The statement of approach explains the methodology used by the AER in carrying out its risk assessment and how the risk assessment has been used.
"The AER's objective is to achieve compliance with the rules. It will work with industry to help achieve this by informing market participants of their obligations and by assisting participants establish effective compliance programs."
The AER publishes reports on the outcome of its monitoring, compliance and enforcement activities every quarter. The reports, and the statement of approach, will be available on the AER website.
Background
The Australian Energy Regulator, established in 2005, is Australia's independent national energy market regulator.
It monitors and enforces compliance with the national legislation governing the electricity and natural gas industries and is the economic regulator of the electricity transmission sector in eastern and southern Australia. Its regulatory responsibilities will soon extend to gas transmission, energy distribution and aspects of energy retail markets.
The AER also assists the Australian Competition and Consumer Commission on energy competition matters such as merger issues and energy authorisations.