The Customer Service Incentive Scheme (CSIS) was first introduced in July 2020. The purpose of this scheme is to provide incentives for electricity Distribution Network Service Providers (DNSPs) to improve their customer service.
The CSIS is a flexible ‘principles based’ scheme that can be tailored to the specific preferences and priorities of each DNSP’s customers to allow for flexibility in approaches and to encourage customer engagement. The principles of the scheme are designed to target customer preferences and provide safeguards to ensure rewards/penalties under the scheme are commensurate with improvements/detriments to customer service.
The CSIS has 4 principles that reflect the necessary components of an incentive scheme which cover:
- performance parameters – what customers want to be incentivised
- measurement methodology – how performance is measured
- assessment approach – how performance is rated, and
- financial component – how penalties/rewards are calculated and applied.
For the CSIS to be applied, incentive designs must meet the schemes' principles. Importantly, we will not apply an incentive design unless a DNSP can demonstrate that its customers support the incentive design through genuine engagement.
Application
The CSIS is applied at the discretion of the AER to a DNSP in its distribution determination. Since this is a new scheme, it currently only applies in Victoria. We expect most, if not all, DNSPs will be seeking to apply this scheme in the next rounds of regulatory proposals.
Details on the Victorian DNSP's individual CSIS applications are available at the relevant DNSP's 2021–26 determination page.
- AusNet Services determination 2021–26
- CitiPower determination 2021–26
- Powercor determination 2021–26
- United Energy determination 2021–26
Outcome 2021–22
We are responsible for assessing the annual CSIS performance of the DNSPs against their targets and for calculating the performance reward/penalty for each DNSP each regulatory year.
We have determined the CSIS reward/penalty outcomes as listed below for each DNSP for the 2021–22 regulatory year.
- AusNet Services $775,170 (this amount does not include an outcome for the CSIS ‘complaints’ parameter)
- CitiPower $1,625,558
- Powercor $3,707,915
- United Energy $2,246,964
For the 2021–22 reporting period, we verified the reported data by CitiPower, Powercor and United Energy has met the criteria outlined in the CSIS.
For AusNet Services, we have determined that three out of four performance parameters are operating in accordance with the CSIS incentive design.
Assessment of AusNet Services' complaint parameter
We decided to suspend (not include in its outcomes) AusNet Services' complaints performance parameter. This was because the data used to measure performance was not collected correctly by AusNet Services. AusNet Services' outcomes were calculated on its remaining three parameters (communication on planned outages; communication on unplanned outages; and customer service for new connections).