The former Hydro-Electric Corporation (HEC) was disaggregated in 1998 to create three entities focused on the core business activities of:
- generation (Hydro Tasmania);
- transmission (Transend); and
- distribution/retail (Aurora Energy).
On 1 July 2014 the distribution arm of Aurora Energy was merged with Transend to form a single distribution/transmission network business, TasNetworks. The retail arm of Aurora Energy continues to provide retail services.
Each entity's obligations are found in the legislation, accompanying regulations and in the Regulator's Tasmanian Electricity Code (Code). More information about the Code is available here.
The Regulator's objectives in administering the Electricity Supply Industry Act 1995 (ESI Act), the Code and other related regulatory instruments, include
- promoting efficiency and competition in the electricity supply industry;
- establishing and maintaining a safe and efficient system of electricity generation, transmission, distribution and supply;
- establishing and enforcing proper standards of safety, security, reliability and quality in the electricity supply industry; and
- protecting the interests of consumers of electricity.
In relation to these objectives the Regulator is responsible for:
- setting maximum retail prices for the sale and supply of electricity services to (regulated) standing offer customers;
- administering the licensing system for electricity entities established by the ESI Act;
- monitoring and regulating technical standards in the electricity supply industry;
- monitoring and enforcing the compliance of electricity entities with their licence conditions;
- performing and exercising the functions and powers of Jurisdictional Regulator for Tasmania under the National Electricity Rules;
- issuing, maintaining, administering, and enforcing the Tasmanian Electricity Code (the Code);
- regulating Hydro Tasmania's wholesale contract activities (from 1 January 2014). More details about the regulation of Hydro Tasmania's wholesale contract activities are available here; and
- carrying out the other functions assigned to the Regulator under the ESI Act, the Regulations and the Code.
The Regulator's functions reflect the fact that each of the entities have significant market power in the respective Tasmanian electricity markets they operate in. Residential and most small business customers require the protection of regulated (standing offer) tariffs in respect of both price and conditions of supply as these customers cannot negotiate on an equal footing with the entities.
While the Regulator has certain statutory responsibilities, a major share of the responsibility for implementation and further development of the regulatory scheme rests with the entities themselves.
The Regulator's approach has therefore been "light-handed" ie the Regulator does not seek to intervene in the day-to-day management of the entities. Rather the Regulator seeks to ensure that all stakeholders are provided with sufficient information to properly assess the performance of the entities in meeting their regulatory obligations. The primary emphasis is on transparency and disclosure, with compliance action used when and if appropriate.