ICCC not regulating electricity

Business

THE Independent Consumer and Competition Commission (ICCC) says it no longer has regulatory oversight in the electricity industry following the passage of the National Energy Authority Act 2021 (NEA Act).
Commissioner and chief executive officer Paulus Ain said this was in accordance with the National Gazettal Notice No: G443, which took effect on July 5.
He said the ICCC had been regulating the electricity supply industry since 2002, until the passing of the NEA Act and Electricity Industry (Amendment) Act 2021 (‘EI [Amendment] Act’).
“The electricity industry in PNG was declared under the Electricity Industry Act to be a regulated industry for purposes of the ICCC Act 2002 until the passing of the NEA Act,” he said.
“Accordingly, in 2002, the then Minister for Treasury, the late Sir Mekere Morauta, declared all power supply services to be regulated services under the ICCC Act.
“As a result of these declarations, the electricity tariffs, service standards and licensing arrangements have been subjected to the ICCC’s oversight.”
Ain said the ICCC had worked with all stakeholders, industry participants and development partners including donors to put in place necessary economic and technical regulatory frameworks, strategies, processes, guidelines and measures to improve and ensure:

  • EFFICIENCY of the electricity sector in PNG;
  • MARKET impartiality and regulatory independence;
  • MARKET competitiveness;
  • AFFORDABLE pricing of electricity services; and,
  • SERVICE accessibility and reliability.

“Since 2002, the ICCC has supported the Government’s development agendas for the electricity industry by developing and implementing various electricity industry codes, rules and regulations that promote and protect efficiency and competition for electricity markets, improved service standards, and ensured regulatory compliance.”
The NEA Act established the National Energy Authority (NEA).
Ain said the institutional changes in the energy/electricity sector meant that:
l NEA would assume the economic regulatory functions of the ICCC, although there was no clear demarcation regarding a split in roles under the NEA Act, nor under the EI Amended Act;
l UNDER the EI (Amendment) Act, the list of functions of the ICCC, as well as parts of the Electricity Industry Act relating to land access and ownership of transmission lines, safety and technical requirements and offences would be repealed;
l LICENSES issued under the Electricity Industry Act (Ch. 78) and the ICCC Act were preserved under the NEA Act, although they did not appear to be any grandfathering clauses; and,
l NEA would have the ability to charge levies and fees, including levies on generation licenses.
Ain said there were a number of discrepancies, unclear provisions, overlapping roles, and inconsistencies within the NEA Act which was likely to pose detrimental impact and plunge the electricity industry into complete chaos which will further impact overarching Government’s goal of 70 per cent electricity access by 2030.
He said while the ICCC respected the Government’s decision to establish the NEA, the regulatory regime outlined under the NEA Act needed be rectified such that NEA functions remained sound and appropriate.

One thought on “ICCC not regulating electricity

  • The consumer end is ICCC responsibility who have interest in service provided especially the tariffs impose on the end users. The price is EI Act through NEA Act responsibility but again ICCC comes in to ensure it does not exceed bench mark. ICCC interest is mainly the consumer part of it if the line can be drawn clearly to avoid duplication of roles. Other roles such as issuing of licensing to IPP and PPA are EI responsibility. This is how I see it from the layman perspective.
    Recent events that are trending of huge investment by PPL like the engaging an overseas company to build transmission, and substations from Hagen to Tari is sanction under whose authority? is NEA involved or is it a direct funding from PPL? Business activities of PPL must now align its value chain with NEA or EL Act directly going forward. Where is the office of NEA???

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