The Consumer Data Right has been officially extended to energy services by the Federal Government.
The Consumer Data Right provides consumers with greater access to their personal information, giving them power to instruct businesses on how to provide safe and secure access to their data to trusted third parties.
Extending the Consumer Data Right to energy builds upon the progress already made by applying it to the banking sector, through what is known as Open Banking. Legislation on the Consumer Data Right for banking came into effect on 1 August 2019.
From February 2020, for the first time, consumers will have greater access to the information that banks hold on them and will be able to use it to shop around and get a better deal.
The Federal Government has now released a consultation paper seeking feedback on the data sets and data access model that will apply to the energy sector.
The government welcomes the release of the Australian Competition and Consumer Commission’s (ACCC) position paper on the data access model for the energy sector, following consultation conducted in early 2019. The ACCC is proposing to use the AEMO gateway model for sharing electricity market data.
Giving consumers more control over their data will support the development of more convenient products and services that are customised to individuals’ needs encouraging more competition, lower prices and better switching between electricity plans and providers.
ACCC Commissioner Sarah Court, said,“Sharing information such as a household’s current energy deal and consumption pattern with other energy service providers will enable a consumer to find the best deal for them.
“This will enhance transparency and put consumers in the driving seat when it comes to comparing confusing deals, so they can find new and innovative offers that best suit them.”
The ACCC compared three data access models and consulted with stakeholders before reaching its decision.
“The gateway model best balances functionality, cost effectiveness, flexibility and security while also leveraging AEMO’s data and IT expertise,” Ms Court said.
“It allows AEMO to facilitate the rollout of the CDR to the energy sector, helping to reduce implementation costs, particularly for smaller energy retailers.”
Thirty per cent of electricity consumers do not switch due to the effort required and 22 per cent due to lack of information.
A consumer would be around $1000 better off by switching from the worst to the best electricity plan in both New South Wales and South Australia. A small business would be over $7000 better off in South Australia and over $4500 better off in Victoria from a similar switch.
The Consumer Data Right for energy will initially apply to the National Electricity Market and will be expanded to other energy markets over time.