Statutes Amendment (National Electricity and Gas Laws - Information Collection and Publication) Bill

Second Reading

The Hon. K.J. MAHER (Minister for Employment, Minister for Aboriginal Affairs and Reconciliation, Minister for Manufacturing and Innovation, Minister for Automotive Transformation, Minister for Science and Information Economy) (18:15): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation and explanation of clauses inserted in Hansard without my reading it.

Leave granted.

The Government is amending the national energy legislation to ensure the Australian Energy Regulator has sufficient and clear powers to collect and publish data in its role as the economic regulator of network service providers.

Energy networks are capital intensive and operate as natural monopolies, as it is not economically feasible to duplicate them. Given this monopoly structure, network service providers are evaluated periodically by the Australian Energy Regulator to ensure only efficient costs are incurred in providing energy services, including safety, security and reliability requirements. The Australian Energy Regulator is required every five years to assess and approve each regulated network service provider's revenue allowance to apply for a regulatory determination period.

The National Electricity Rules and National Gas Rules set out the approach that the Australian Energy Regulator must use to determine the revenue allowance. The approach requires the Australian Energy Regulator to determine the revenue allowance based on costs components an efficient business needs to incur to provide the services. The Rules acknowledge benchmarking will be used by the Australian Energy Regulator to determine the needs of an efficient business.

The Statutes Amendment (National Electricity and Gas Laws – Information Collection and Publication) Bill 2016 makes amendments to the National Electricity (South Australia) Act 1996 and the National Gas (South Australia) Act 2008 to ensure the Australian Energy Regulator has sufficient and clear powers to collect and publish data necessary to benchmark the performance of electricity and gas network service providers.

Currently, the Australian Energy Regulator may prepare electricity and gas network service provider performance reports. These network service provider performance reports may deal with the financial or operational performance of a network service provider in relation to service standards and profitability.

The Bill will clarify that the Australian Energy Regulator must prepare these performance reports if required by the National Electricity Rules or National Gas Rules. The existing National Electricity Rules require the Australian Energy Regulator to prepare and publish an annual performance report, referred to as the annual benchmarking report, on the relative efficiency of the electricity network service providers.

It is also clarified in the Bill that performance reports published by the Australian Energy Regulator may deal with the financial or operational performance of a network service provider in relation to the efficiency of the network service provider in providing the services.

To ensure the Australian Energy Regulator can use existing information gathering powers to collect data solely for the purpose of benchmarking the efficiency of network service providers in the performance reports, the Bill will remove the restrictions on the Australian Energy Regulator from issuing a regulatory information instrument solely for the purposes of collecting information for preparing network service provider performance reports.

To support the Australian Energy Regulator's ability and in some circumstance obligation to publish network service provider performance reports, the Bill deals with confidentiality issues.

Rather than relying on the existing general provisions in national energy legislation which deal with disclosure of confidential information held by the Australian Energy Regulator, the Bill includes specific confidentiality provisions applicable to complying with a regulatory information instrument. This is to address concerns that the existing process for the release of confidential information is time consuming, resource intensive and can encourage blanket claims of confidentiality in response to regulatory information requests.

The Bill places the onus of claiming confidentiality of information requested in a regulatory information instrument on the network service provider. The network service provider may make a claim on confidentiality on behalf of themselves or a third party who provided them with information. The network service provider will need to claim confidentiality and provide reasons in support of the claim at the time the information is provided to the Australian Energy Regulator in compliance with a regulatory information instrument. This is appropriate as the network service provider is best placed to identify the reasons why information is confidential and should not be subject to release.

It is at this point in the process that the network service provider has the opportunity to provide the Australian Energy Regulator with information about any detriment that might be caused to them if the information were to be disclosed, or any detriment that might be caused to a third party who provided them with the information, if known.

Importantly, the Bill provides that information provided to the Australian Energy Regulator in response to a regulatory information instrument which is not subject to an express claim of confidentiality under the new process is not regarded as being confidential.

These provisions in the Bill will ensure that the Australian Energy Regulator is not unduly restricted in the information it publishes and ensures stakeholders, as far as possible, have information available on the performance of their local network service providers to assist them to engage in the revenue determination processes undertaken by the Australian Energy Regulator.

Given the importance of addressing information asymmetries in the revenue determination processes, the Australian Energy Regulator can publish information for which confidentially has been claimed in accordance with the new process. In doing so, the Bill requires the Australian Energy Regulator to comply with existing provisions in the national energy legislation regarding the disclosure of confidential information.

The existing provisions regarding disclosure of confidential information include among other things that the Australian Energy Regulator may disclose confidential information if the disclosure does not lead to the identification of the person to whom that information relates and where the detriment does not outweigh the public benefit in disclosing it.

The Bill also adds to the existing circumstances in which the Australian Energy Regulator can disclose confidential information. The Australian Energy Regulator is authorised to disclose confidential information if it is aggregated so that it does not reveal any confidential aspects of the information.

If the Australian Energy Regulator intends to release confidential information it has received in response to a regulatory information instrument on the basis the disclosure would not cause detriment, the Bill provides that the Australian Energy Regulator may release it after considering the detriment that might be caused as advised at the time confidentiality was claimed, giving written notice and the AER's decision setting out its reasons and after expiry of the restricted period. This ensures that the process of providing information about the detriment that could be caused by disclosure is not duplicated.

A more comprehensive disclosure process applies where the Australian Energy Regulator is seeking to release confidential information it has received in response to a regulatory information instrument on the basis the public benefit in disclosure outweighs the detriment it would cause. This is to ensure that the providers of the information are given the opportunity to be heard on the issue of whether there is public benefit in disclosing the information.

In this circumstance, the Bill requires the Australian Energy Regulator to provide persons that provided the information a specified period to make representations in relation to the public benefit test. The Australian Energy Regulator must only disclose the information after considering the previously obtained information on the detriment that disclosure may cause and the representations in relation to the public benefit test, giving written notice and the AER's decision setting out its reasons and after the expiry of the restricted period.

The Bill also takes the opportunity to make it clear that the procedures set out in the Bill and in the existing national energy laws regarding the disclosure of confidential and protected information if the detriment does not outweigh the public benefit are an exhaustive statement of the requirements for procedural fairness and the natural justice hearing rule.

The Bill is not intended to apply retrospectively. A provision has been included to make it clear that information previously disclosed will be subject to the provisions of the national energy laws in force immediately before the commencement of this Bill.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

3—Amendment provisions

These clauses are formal.

Part 2—Amendment of National Electricity Law

4—Amendment of section 28F—Service and making of regulatory information instruments

Section 28F(3)(d) of the National Electricity Law is deleted.

5—Insertion of sections 28OA and 28OB

New sections 28OA and 28OB are inserted:

28OA—Confidentiality issues

This section makes provision in relation to claiming confidentiality of information given to the AER in compliance with a regulatory information instrument.

28OB—Disclosure of information given to AER in compliance with regulatory information instrument

Provision is made in relation to the disclosure (by the AER) of information given to the AER in compliance with a regulatory information instrument.

6—Amendment of section 28V—Preparation of network service provider performance reports

Amendments are made in relation to the preparation of network service provider performance reports.

7—Insertion of section 28ZAA

New section 28ZAA is inserted:

28ZAA—Disclosure of information in an aggregated form

The AER is authorised to disclose information given to it in confidence in aggregated form (so that it does not reveal any confidential aspects of the information).

8—Amendment of section 28ZB—Disclosure of information authorised if detriment does not outweigh public benefit

Certain related amendments are made to section 28ZB.

Other amendments provide for procedures and other matters in relation to the AER's decision to disclose information under the provision.

9—Insertion of section 54FA

New section 54FA is inserted:

54FA—Disclosure of information in an aggregated form

Provision is made for AEMO to disclose information in aggregated form (in the same manner as the AER).

10—Amendment of section 54H—Disclosure of protected information authorised if detriment does not outweigh public benefit

Similar to the proposed amendment in relation to the AER, it is provided that section 54H is taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the disclosure of certain information by AEMO.

11—Amendment of Schedule 3—Savings and transitionals

A transitional provision is inserted:

Part 13—Information publication

26—Information publication

The release of information given to the AER or AEMO in confidence before the commencement of the clause will be subject to the provisions of the National Electricity Law in force immediately before that commencement.

Part 3—Amendment of National Gas Law

12—Amendment of section 48—Service and making of regulatory information instruments

Section 48(3)(d) is deleted.

13—Insertion of sections 57A and 57B

New sections 57A and 57B are inserted:

57A—Confidentiality issues

This section makes provision in relation to claiming confidentiality of information given to the AER in compliance with a regulatory information instrument.

57B—Disclosure of information given to AER in compliance with regulatory information instrument

Provision is made in relation to the disclosure (by the AER) of information given to AER in compliance with regulatory information instrument.

14—Amendment of section 64—Preparation of service provider performance reports

Amendments are made in relation to the preparation of service provider performance reports.

15—Insertion of section 91GFA

New section 91GFA is inserted:

91GFA—Disclosure of information in an aggregated form

Provision is made for AEMO to disclose information in aggregated form (in the same manner as the AER).

16—Amendment of section 91GH—Disclosure of protected information authorised if detriment does not outweigh public benefit

It is provided that section 91GH is taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the disclosure of certain information by AEMO.

17—Insertion of section 328B

New section 328B is inserted:

328B—Disclosure of information in an aggregated form

Provision is made for the AER to disclose information in aggregated form

18—Amendment of section 329—Disclosure of information authorised if detriment does not outweigh public benefit

Certain related amendments are made to section 329.

Other amendments provide for procedures and other matters in relation to the AER's decision to disclose information under the provision.

19—Amendment of Schedule 3—Savings and transitionals

A transitional provision is inserted:

Part 14—Information publication

89—Information publication

The release of information given to the AER or AEMO in confidence before the commencement of the clause will be subject to the provisions of the National Gas Law in force immediately before that commencement.

Debate adjourned on motion of Hon. T.J. Stephens.