49,000 hot water customers in NSW left unprotected by outdated regulations

8 Apr 2021

More than 49,000 NSW residents live in apartment buildings or strata complexes where the sale of hot water is unregulated - these customers have no access to energy specific consumer protections or dispute resolution. 

The Energy & Water Ombudsman NSW (EWON)’s latest report calls for policy makers to address the consumer protection shortfall for residents whose hot water is supplied by an embedded network operator. 

The National Energy Consumer Framework (NECF) guarantees energy customers access to affordable energy and includes provisions to keep households experiencing vulnerability connected. Just under 253,000 households with common hot water systems benefit from NECF energy specific consumer protections because their gas distributor and energy retailers are part of the competitive energy environment.

But an increasing number of NSW residents have their hot water supplied by operators within embedded networks who have no obligation to comply with water or energy regulations.  These customers have no access to retail energy competition, billing or pricing protection, or affordability support and face increased risk of disconnection. 

“Hot water is an essential service, but this critical issue is placing a growing number of customers at risk,” said Energy & Water Ombudsman NSW, Janine Young. “Current regulations haven’t caught up with emerging energy technologies and business models.”

At least 56% of complaints to EWON from residential gas customers in 2020 came from customers living in apartments or strata scheme complexes. Hot water services were a factor in around 29% of these complaints, with many relating to high and estimated bills. 

“EWON receives this type of complaint but our reach is limited by lack of regulation and jurisdiction,” Ms Young said. “These residents need energy specific consumer protections and full access to Energy & Water Ombudsman schemes.”

“EWON has identified this growing issue through our casework but we do not have the ability to address the regulatory imbalances without support from government and policy makers.  We are keen to work collaboratively to close these consumer protection gaps given the increasing number of NSW consumers who are at risk of losing access to essential services.”  

Read the full report

For queries about policy issues raised in the report, contact Policy Manager Rory Campbell.  To request an interview with the Ombudsman email Communications Manager Fran Strachan or phone 0429 416 070.