Vic to ban new 'embedded' power networks

Victoria will ban private electricity networks in new apartment blocks in a bid to drive down soaring energy costs and give households greater choice.

Embedded networks are commonly used to supply power to multiple-customer premises such as apartment blocks, retirement villages, social housing and caravan parks, preventing consumers sourcing a potentially cheaper deal.

But the networks will be outlawed in new apartment buildings from January next year, with existing networks reformed, paving the way for 140,000 Victorians to access more competitive deals.

"All Victorians deserve to get the same competitive energy deals and have the same protections, driving down the cost of living when people need it most," Energy Minister Lily D'Ambrosio said in a statement.

The ban was a 2018 state election promise by the Andrews government in response to residents expressing concerns about being "trapped" in embedded networks.

It was recommended following a review by a Victorian government-appointed expert panel last year and formally accepted on Tuesday.

Under the changes, there will be limited exemptions for new embedded networks to operate if they run on 100 per cent renewable energy.

Existing embedded networks across the state, which were price-capped at the Victorian Default Offer in 2020, will also be permitted, but customers transitioned off them over time.

The second phase of the expert review will determine the details of a new licensing regime for embedded networks, which is forecast to be up and running by late-2023 to mid-2024.

Opposition planning minister Ryan Smith said despite the announcement, the majority of current Victorian apartment residents were no closer to cheaper energy bills.

He said more than 90 per cent of Victorians living in an apartment will miss out on any increase in energy provider competition.

"When fewer than one in ten current apartment residents will benefit from these changes, it's clear the Andrews Labor Government has failed."

Austrlaian Associated PressBack to Breaking News

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