AGL recently responded to the draft Designation Instrument for energy Consumer Data Right (CDR) released by Treasury on 6 May 2020.
AGL has been a strong advocate of CDR being introduced into the energy sector. We have uploaded over 20 articles and submissions on the CDR which can be accessed on this Hub.
The CDR regime offers opportunities for consumers and businesses to benefit from the sharing of data– all through the explicit informed consent of the individual consumer. AGL supports the development and roll out into the energy sector of the CDR regime, recognising the benefits that can be delivered to consumers through better and more timely information to make decisions on the right energy products and services based on their household or business structure and usage behaviour.
To ensure a consistent consumer experience with CDR across various sectors of the economy, and to properly achieve the objectives of the CDR regime to deliver benefits to consumers and businesses, decision-makers need to ensure that energy needs are considered and incorporated into the broader CDR requirements. For example, there must be wherever possible industry agnostic technical standards and CDR Rules commonality across sectors.
As CDR is intended to be an economy wide framework it is important the decisions made for the energy designation focuses on the overall objectives of the CDR regime regarding interoperability and leveraging existing industry arrangements, to build consumer awareness and trust, and therefore participation. This includes having one consent and verification model across sectors and building on current consumer and industry relationships for consent and verification. Rather than building new and unfamiliar arrangements co-ordinated through bodies or organisations that do not have consumer service relationship and experience.
We are already diverging from the principle of an economy-wide CDR model with the in-principle decision made to use the Australian Energy Market Operator (AEMO) as the energy sharing data gateway. This is a markedly different approach than banking which is using what is referred to an economy model, whereby consumer or their authorised representatives approach the bank directly to access their banking data.
The AEMO gateway model can offer some efficiencies to retailers in terms of the orchestration of market participants who hold various data sets, but this does not mean the gateway should provide any more than this to the CDR system. This is based on AEMO’s current functionality of building systems and processes to allow for energy participants (e.g. retailers, networks) B2B transactions to occur efficiently. Energy data flows through these B2B arrangements and therefore, the fundamentals for data sharing exist.
For CDR in energy, we can leverage the current AEMO market arrangements for data flows, but also leverage existing relationships and arrangements that retailers, banks or telecommunication companies already have with consumers. We encourage utilising the current retailer touchpoints with consumers as this is in line with the intention of the broader CDR regime. For example, retailers already have established processes for obtaining consumer explicit informed consent, and processes for customer authentication and validation.
In our submission, we provide comments on the drafting of the designation instrument and note that:
- The draft designation instrument is significantly broader than previously discussed and may represent unintended risks and costs. We encourage Treasury to undertake a fulsome review, including consider further consultation on the draft designation instrument that is accompanied by relevant supporting materials such as the privacy impact assessment and relevant cost-benefit analysis.
- To achieve the interoperability objective, the proposed AEMO Gateway model should be limited to data transfer/conduit role between CDR participants. This should be explicitly stated within the ACCC Rules. The data standards should flow through AEMO to retailers.
- While the energy sector has some unique characteristics, the more bespoke the energy model becomes the higher the industry costs of compliance and operation will be, hampering the delivery of consumer benefits.
You can access our full submission here.