Aus Government to apply Consumer Data Right to the energy sector

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Federal Treasurer Josh Frydenberg and Minister for Energy and Emissions Reduction Angus Taylor have announced that the Morrison Government is formally applying the Consumer Data Right (CDR) regime to the energy sector. 

CDR, in principle, gives consumers better access to their data and more oversight on how businesses use said data. By applying the CDR to the energy sector, the Government says consumers and businesses will be able to “more easily compare and switch between electricity plans and providers, encouraging more competition, lower prices and more innovative products and services.” 

The CDR was one of the key policy results of the Royal Commission into Banking, with banks now required to show product reference data. It is not yet clear exactly what data the consumer will have more proprietorship of, but personal data such as names and addresses of account holders is the most likely first stage, followed by metering data, billing data, product data, etc,.

The Australian Energy Council has welcomed the announcement, saying that giving consumers greater access to their energy data will help foster competition. “We know that the best way to lower energy costs for households and small businesses is through competitive markets,” said AEC Chief Executive Sarah McNamara. “enlisting the help of third parties through the CDR will make it easier for customers to find the cheapest deals.” 

Of course, data arouses much-warranted concern. Firstly privacy, and the CDR is not being well-received. Indeed, the Australia Privacy Foundation has not been private about its concerns as to the privacy safeguards in place for the CDR, arguing the Morrison Government has “severely” underestimated” the task of data legislation. 

Nevertheless, privacy is not the only threat Big Data poses. 

Big Data

Data, Big Data, surveillance capitalism, whatever you want to call it, what is agreed is that data is the future, and the future has already arrived. The Economist described Data as the oil of the 21st Century, “a driver of growth and change.” And much like the history of oil, “Many a battle will be fought over who should own, and benefit from, data.” And the BBC went so far as to liken data to sunlight, because it is everywhere and underpins everything. 

The crucial difference, of course, is that whereas a great deal of last Century’s oil came from the House of Saud, who believes Saudi Arabia’s plenitude of oil a divine approval of themselves and Wahhabism, and a lamentable list of other theocratic autocrats, oligarchs, and sycophantically fascistic crime families, Data is democratic in origin. 

As such, the uses of data grow as exponentially as data itself, in the energy sector the uses range from easier outage detection and prediction to smart grids, demand response management, operational efficiency, and last but hopefully never least – improved customer experience. 

In 2019, Chair of Energy Consumers Australia (AEC) Louise Sylvan spoke at the Data powering better outcomes for consumers forum of data’s potential to drive better energy policy, decision-making, “under-pinning a fundamentally different and individualised experience for consumers.” Data represents, Sylvan continued, “what looks like the end of the one-size-fits-all energy market.” 

As energy becomes decentralised, driven mainly by the millions of Australians empowering themselves with solar PV, energy is moving from a top-down dictatorship to a bottom-up ‘participatorship’, less conscious than a vote but more representative than choicelessness. 

However, as Sylvan readily admits, the integration of data has not yet produced the only outcome most of us sacrifice portions of our privacy for, namely, cheaper bills. Sylvan believes that consumers need to be much more “explicit about their preferred future, both in policy processes and investment decisions…that have the potential to lock in future pathways and close some others.” 

It is this necessity of consumer explication that drives the Consumer Data Right (CDR). To elevate consumer data to the heights of Rights may seem slightly flippant until one realises the omnipotence data is moving toward, and the fact that in the face of overwhelming power, Rights exist only in so far as they are expressed. 

Competitive Spirit? 

Of course, it is called Big Data not for its size (‘Big’ would be an exercise in gargantuan understatement), but for its relation to Orwell’s Big Brother, the all-powerful, all-seeing monopolised power acting, as Orwell put it, “for its own sake.” 

The AEC, ECA, and the Morrison Government argue the CDR is a tool for encouraging competition but does data inculcate competition? Take the world’s biggest data silos, like Google or Facebook, are these not monopolies? Oxford University’s Ariel Ezrachi and the University of Tennessee’s Maurice Stucke argue in “Virtual Competition”, that those companies with the most data and the best algorithms will be able to detect competitive threats early, such as a startup that might one day become a rival, and simply buy them out. “The invisible hand is becoming a digital one,” said Ezrachi. 

Whether CDR is any kind of protection against monopolisation and encouragement of competition is yet to be seen in the banking sector, although it is probably uncontentious to say that normal practice has resumed. 

Undeterred, the Government is adamant that switching from the worst electricity plan to the best could save the average consumer between $750-$1000. One hopes the CDR can make those kind of savings more apparent to the consumer because as it stands Australia has cleaner and cheaper energy than ever before and yet electricity prices continue to rise. 

The Australian Competition and Consumer Commission (ACCC) will commence consultations on the proposed rules for the energy sector in the near future.