17 March 2017

The impact of an open data regime on Australia’s new energy future

Every day, Australian residents, utilities, government agencies and innovative start-ups generate and collect energy and market data. As we transition to a New Energy Future, the energy industry and governments face a significant challenge – how to create the optimum policy framework to facilitate open data sharing and all that it offers energy consumers while ensuring those are adequately protected.

The Australian Productivity Commission’s report on Data accessibility and use is a fundamental step in changing the way the data is shared.

What did the draft report say about energy?

The first draft of the Productivity Commissions’ data availability use report highlighted several benefits of increased access to data in the energy industry, including:

  • Increased competition
    • New products are coming to market, such as energy comparison product Energy Tailors, which obtains consent from customers to access and analyse their smart meter data and suggest better tariffs. The midata program in the UK offers something similar across multiple industries.
    • Increased privatisation in the energy industry has created concern about the creation of “data monopolies”. Increased access to data, particularly for new entrants, would alleviate this.
  • Greater innovation
    • Smart meters data and the use of the Internet of Things in the energy industry to drive greater consumer value (particularly focusing on the Victorian adoption of smart meters).
    • When New York City began releasing detailed energy data for commercial buildings, the building owners were able to benchmark the energy efficiency of their buildings and prioritise future energy-reducing investments.

What will the final report say?

As we previously reported, the Commission released its draft report in November last year. Following a further period of consultation, it is expected to release its final report later this month.

Since the release of the draft report, recent events in South Australia coupled with the rise in battery storage technology to support grid efficiency and energy stability have increased the urgency and importance of addressing not only the access and use of energy data but also the investment, support and encouragement for the availability of more granular, useful and dynamic data.

The final report will be essential reading for all companies in the energy sector. The Commission’s recommendations are likely to have significant implications for Australia’s energy tech innovators, whose business models invariably depend on network and metering data as key inputs. The following three points are some key themes we expect to see in the report next Tuesday:

  • The Commission’s draft report proposed a new “Comprehensive Right”, which would give individuals the ability to require a copy of their data to be transferred from one service provider to another. While this regime seems to track the recent AEMO reform to metering data, it is important to recognise that this right moves beyond just the provision of consumer data and focus’ heavily on making industry and government data more readily available to third parties exploring access and governance mechanisms such as whitelists and Open API’s.
  • The Commission’s initial recommendations about opening up designated ‘National Interest Datasets’ to trusted users under a new data sharing framework may represent a significant opportunity for innovators. For energy network data, this will ensure researchers like CSIRO and national bodies like ARENA are provided with data in a more managed and reliable way. This is an important shift that will encourage the industry to discuss data governance frameworks – a conversation currently missing from the rule-based regulatory reform conversations.
  • It will be interesting to see how the Commission’s final recommendations play out within the current energy legislative framework. As it stands, energy data is regulated under the Privacy Act, the National Energy Legislation, National Energy Regulations, National Energy Rules and the common law around confidentiality. With multiple custodians and privacy frameworks, data resource management within the energy industry is fragmented, confusing and inefficient. The Productivity Commission’s final recommendations are likely to acknowledge the need for data policy to consider the significant regulatory reforms happening in the energy sector, including smart metering data access and mandatory supply of network data to third parties.

The Productivity Commission’s challenge in making its final recommendations will be to strike the right balance between incentivising new products and services and protecting existing capital investments that many organisations (particularly those in the energy industry) have made in creating significant value added data assets.

KWM’s New Energy Future team will provide an update when the report is released, if you are interested please subscribe to our Energy & Utilities updates.

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