The COAG energy council has to approve the new regime through amendments to the national energy laws, which the federal government expects to be finalised by the end of the year. The most recent meeting was held last December.
“This is yet another important energy policy decision stuck in limbo while [federal Energy Minister] Angus Taylor refuses to call a COAG energy council,” Victorian Energy Minister Lily D’Ambrosio said.
“Now more than ever we need certainty from our energy companies and we need changes to our outdated energy regulations to achieve this.”
Mr Taylor, who backs the proposal for the new powers and a tougher penalty regime, said he was “committed to ensuring that the regulator has a strong suite of powers to investigate and litigate bad behaviour in the energy market”.
Ms Conboy said the powers were a “long time coming” and would better equip regulators to carry out investigations and take the legal action necessary to ensure compliance amid an influx of new power generation coming into the grid, such as renewable energy sources.
Her comments come after the regulator last month announced it was taking legal action against wind farm operators over the dramatic 2016 South Australian blackout that cut power to 850,000 homes and businesses.
Ms Conboy said the lawsuit, alleging AGL, Neoen, Pacific Hydro and Tilt Renewables failed to comply with performance requirements to ride through major disruptions, took three years to proceed as evidence had to be sought and obtained via “written requests”.
“It would have been much shorter than three years had we had that ability to compel oral evidence, to have the people in the room and question them,” she said.
“We still don’t have that ability. I understand the legislation is on the verge of being put through and we really need that … That’s going to make a big difference.”
The regulator has also recently announced legal action against the Pelican Point gas power station in Adelaide, alleging it failed to notify the authorities that it had spare capacity which could have helped South Australia avoid widespread blackouts.
I understand the legislation is on the verge of being put through and we really need that.
AER’s Paula Conboy
Ms Conboy on Monday also criticised the Australian Energy Regulator’s maximum civil penalty for regulatory breaches, which is $100,000 per breach.
“You can go through all of this process and end up with a penalty that seems quite small, and is quite small,” she said. “Civil penalties are just not on par with other regulators.”
The COAG energy council will consider lifting civil penalties that could run into the millions of dollars.
Tony Wood, energy director at the Grattan Institute, a public policy think tank, said the energy regulator’s lack of compulsory information-gathering powers was a “gap that should be fixed”.
“Broadly the idea of giving the AER more powers is a good one,” Mr Wood said.
“They still have to be prepared to bite with those teeth, and we’ll see how that turns out, but the legal action they are taking against companies over the South Australian blackout shows they are prepared to move strongly.”
Business reporter for The Age and Sydney Morning Herald.