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ACCC consultation on the CDR energy rules framework

Our submission to the ACCC on the CDR energy rules framework.

August 2020: In anticipation of the rollout of the Consumer Data Right in the energy sector, the ACCC has released an energy rules framework consultation paper. This is our submission in response to the paper, which puts forth four key recommendations. Visit our government submissions hub for more Finder submissions to government consultations and inquiries.

Finder is proud to be an Australian-owned global fintech business that has succeeded in growing internationally, and we now have offices in Sydney, New York, London, Toronto, Manila and WrocΕ‚aw.

Our primary recommendations in the submission are as follows:

  • Help Australians to make better decisions about their energy products by creating a two-tiered approach to CDR in the sector where personalised product comparisons can be done with simpler authentication than currently proposed.
  • Make this available for consumers sooner rather than later by expediting the launch of this simple product comparison use case to go live at the same time as generic product data.
  • Conduct further research to identify the "strong authentication" model that creates the highest trust and lowest friction experience for consumers.
  • Allow as many consumers to benefit from the CDR as possible by getting major retailers in early and including as many smaller retailers in the scheme as possible.

Prioritising simple product comparison

We believe that the primary use case for the CDR in energy will be accurate price comparison. Thousands of Australians visit Finder every day wanting to quickly know the best energy plan for them based on their energy usage. At the same time, our analysis of the best offers in the market in July 2020 showed that the average Australian consumer could save $284 a year by switching to the least expensive plan on the market. We think that thousands of Australians saving hundreds of dollars a year is an outcome worth pursuing and, as a result, we believe that the top priority for the CDR in this sector should be to make these simple price comparisons available to more consumers as quickly as possible.

In order to achieve this, we believe that the top priority for this consultation is the ACCC revisiting some of its positions in order to make aggregated and anonymised metering data available through the CDR using a simple authentication model on an expedited timeline.

The good news is that much of the work required to make this a reality has already been completed. The comparison sites run by the Australian Energy Regulator (AER) and the Victorian Department of

Environment, Land, Water and Planning (DELWP) are able to access anonymised metering data today through the AEMO Consumer Data Platform when a customer provides their postcode, NMI and retailer name. We believe that the CDR should incorporate this model of data access rather than replace it. It's also worth noting that AEMO Consumer Data Platform was supported with funding from the Commonwealth Government to help consumers compare energy deals. We continue to be hugely supportive of the CDR but attempting to replicate a data delivery model in an industry where a workable solution already exists is unnecessary and a waste of public resources.

We think a number of changes to the framework proposed in the consultation paper could incorporate this model of data sharing and ensure a high proportion of the benefits of the CDR in energy are realised by Australian consumers before the end of 2021. We've summarised our proposed amendments below:

    • Data sets: Include aggregated/anonymised metering data as a separate data set within Tranche 1.
    • Phasing: Mandate access to the above metering dataset at the same time as generic product data, with both available before the end of 2021.
    • Authentication: Introduce two-tiers of authentication, one of which would allow access to aggregate metering data with the provision of a customer's NMI, postcode and retailer name.
    • Accreditation: Allow access to this data on a one-time access only basis for data recipients accredited at the unrestricted level.

Not only would these changes benefit consumers but they would also address some fundamental inequities in the energy comparison landscape that have favoured the government-led websites for a number of years. Not only have these sites benefited from generic product data since their inception, but the metering data made available to them more recently through AEMO has created a further advantage when compared to commercial operators. Whether through this consultation or elsewhere, we believe that the ACCC has a role to play in ensuring that the market for energy comparison services in Australia is competitive and that all participants have equal access to data sets that enable accurate personalised comparisons.

Data sets

Broadly, Finder is supportive of the proposed approach to data sets in the energy rules. As mentioned above, we believe that a "new" data set that is a subset of the metering data set should be introduced so that a consumer can give an accredited data recipient their metering data in an aggregated and anonymised way. Ideally, this data would give at least a 12-month view of the consumption data associated with that meter. If that data could be further broken down into time of usage figures so that the comparison service can calculate peak, off-peak and shoulder consumption that would be even better. This data would allow for a simple, personalised price comparison for most consumers.

As this data set is already available to AEMO as shown through the Consumer Data Platform, we see no reason why this dataset shouldn't be included in Tranche 1 of the proposed sequencing for data sets, alongside generic product data. This would mean that more consumers would be able to benefit from simple product comparisons more quickly.

Authentication

As with the banking implementation of the CDR, we welcome a strong authentication model for sensitive data sets. Strong authentication creates the trust in the system that will be critical for adoption. In energy, this is particularly important for sensitive data sets like billing and hardship data. For these and other relevant data sets, we can see advantages and disadvantages in the two strong authentication models proposed in the consultation paper.

The main advantage of Model 1 is that the consumer already has a relationship with the energy retailer, and authenticating with them could improve confidence in the system. The potential downside is that the varied implementation of the authentication process between retailers could create an inconsistent experience depending on which retailer the consumer currently is with. In contrast, the key benefit of Model 2 is that by letting AEMO handle the authentication process for all retailers, a more consistent user experience across the energy sector would be created. We also believe that a combination of AEMO and CDR branding has the potential to create a stronger trust signal than the energy retailer alone and that involving AEMO at this stage would improve consumer comprehension of the role played by AEMO in the CDR for energy.

Currently, our slight preference would be for Model 2, but we would welcome further CX research to test which model best creates the most trusted, lowest-friction consumer experience. If further research was conducted, we would welcome the inclusion of a third option being explored where the AEMO creates a white label authentication experience where the consumer doesn't feel like they have left the data recipient ecosystem, while still providing the one-time password in a secure way.

As stated in the opening section of this submission, this type of strong authentication model is not necessary for the aggregated and anonymised metering data set that we have proposed. As is currently the case on both the AER and DELWP comparison sites, we think the consumer authenticating their access to this data set by sharing their NMI, postcode and retailer details is secure enough for a data set with limited sensitivity. Our understanding of the privacy work done to date supports this position. As KPMG phrased it in its Supplementary Privacy Impact Assessment for the CDR in the energy sector, "there is no reason to conclude that these individuals would be reasonably identifiable to an ADR from Metering Data (as currently defined). This means, therefore, that no potentially sensitive information would be disclosed about them." Our view is that this data set is made even less sensitive when it is provided in an aggregated way. As a result, a simpler authentication model for this new data set using just NMI, postcode and retailer details is suitable.

Dashboards

When it comes to data holder dashboards, we believe that the options provided may not necessarily be mutually exclusive and that consumers should be able to revoke access with all parties involved. Given the implementation of the CDR in the energy sector, this means that the consumer should be able to manage their consents with the data recipient, with the data holder (energy retailer) and with the gateway (AEMO).

That being said, we'd suggest ensuring that the consumer is provided with no more than one data holder receipt when data sharing occurs, with one dashboard included on this receipt to avoid confusion. It is important to note that the consumer will already be receiving a receipt from the data recipient so we do not want to overload the consumer at this stage.

The logical party to provide the data holder receipt and the associated dashboard in the energy sector has a strong interdependence with the decision made in relation to the authentication model. If the decision is made to go with Model 1, then the energy retailer should provide the receipt with access to their dashboard. If Model 2 is the preference, then AMEO should also provide the receipt with access to the data holder dashboard. Either way, we do not see why the consumer should not be able to revoke access with any of the three parties involved in the data sharing agreement.

Phased implementation

On phasing and timelines, we would welcome the inclusion of the AER & DELWP as data holders in Tranche 1 to share generic product data. As stated previously, we would also welcome the inclusion of aggregated metering data at the same time as the release of generic product data.When it comes to data holders, we welcome the inclusion of as many retailers in the scheme as early possible to ensure that the CDR is available to as many consumers as possible. As such, our preference of the options provided would be Option 3, with the 10 largest retailers included in the first tranche of retailers. We also appreciate the desire to create a threshold for a minimum number of customers, to avoid the cost of the CDR being prohibitive to smaller participants in this sector. Based on our analysis, a threshold of 3,000 customers could be a sustainable benchmark that ensures that most Australian consumers have access to the benefits of the CDR, while also allowing smaller energy retailers enough space to grow before being required to provide consumer data through the CDR.

Combining these proposals effectively creates three tranches of data holders to release two tranches of data sets. See the tables below for a summary of our proposed phased implementation:

Finder proposal for sequencing of data holders:

Tranche 1Tranche 2Tranche 3Exclusions
– AEMO (for aggregated metering data)– Remaining AEMO data– Remaining retailers with over 3,000 customers– Retailers with fewer than 3,000 customers
– AER– 10 largest retailers
– DELWP

Finder proposal for sequencing of data sets:

Tranche 1Tranche 2
– Generic product data– NMI data
– Aggregated metering data– Metering data
– DER register data
– Customer data
– Billing data
– Tailored tariff data

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