Feedback sought on customer compensation scheme

We are seeking feedback on our latest estimate of the minimum weekly amount (MWA) retailers must pay to customers during an official conservation campaign (OCC).

We propose retaining the MWA at $12 per ICP, the same level set in 2023 when the MWA was last reviewed.

Under the Electricity Industry Participation Code 2010 (Code), all retailers are required to pay their qualifying customers a weekly amount of financial compensation for their reduction in electricity usage if the system operator has commenced an OCC. The last OCC was in 2008.

There are three important effects from retailers needing to provide compensation for their customers’ electricity savings during an official conservation campaign:

• it incentivises retailers to manage hydrological risk, through appropriate hedging (to avoid an OCC and therefore avoid paying compensation)
• it incentivises generators to invest in last-resort dry-year generation (to fulfil their hedge obligations)
• it encourages consumers to conserve energy should an OCC be called (through compensation payments).

Feedback on our draft determination of the MWA closes on 22 October.

View draft determination paper

More details about the customer compensation scheme are in the Code.