New South Wales Bills Explanatory Notes New South Wales Bills Explanatory Notes[Index] [Search] [Download] [Bill] [Help]
ELECTRICITY (AMENDMENT) BILL 1993*
NEW SOUTH WALES
EXPLANATORY NOTE
(This Explanatory Note relates to this Bill as introduced into Parliament)
The object of this Bill is to amend the Electricity Act 1945 to constitute electricity
distributors as bodies corporate.
Electricity distributors will perform essentially the same electricity supply functions
as are now performed by the county councils that supply electricity, some of which the
Bill proposes to abolish. The policies of an electricity distributor will be determined by
a board of directors whose composition will vary depending on the distributor
concerned. All the electricity distributors are to be governed by Ministerial directions
and may enter into performance agreements with the Minister.
The proposed Act also:
(a) amends the Traffic Act 1909 with respect to the funding and administration of
the Traffic Route Lighting Subsidy Account and the Hazardous Poles
Relocation Program; and
(b) repeals the County Districts Reconstitution Act 1979; and
(c) makes minor and consequential amendments to other Acts.
Clause 1 states the short title of the proposed Act.
Clause 2 provides for the commencement of the proposed Act on a day or days to
be proclaimed.
Clause 3 is a formal provision that gives effect to Schedules 1 and 2 containing
amendments to the Electricity Act 1945.
Clause 4 is a formal provision that gives effect to Schedule 3 containing
consequential amendments to other Acts.
Clause 5 repeals the County Districts Reconstitution Act 1979.
* Amended in committee--see table at end of volume.
SCHEDULE 1--AMENDMENT OF THE ELECTRICITY ACT 1945
RELATING TO ELECTRICITY DISTRIBUTORS
Schedule 1 (3) and (4) remove provisions relating to electricity councils and insert a
new Part 2A which constitutes electricity distributors. The provisions of that Part are as
follows:
PART 2A--ELECTRICITY DISTRIBUTORS
Division l--Constitution
Proposed section 6 constitutes electricity distributors as bodies corporate.
Proposed Schedule 7 also specifies the operating districts for the electricity
distributors (called "distribution districts").
Proposed section 6 8 allows for amendment of Schedule 7 to the proposed Act by
regulation.
Proposed section 6B allows Broken Hill City Council and Tenterfield Shire
Council to exercise the functions of electricity distributors if the Minister approves.
In the exercise of such functions, they are subject to the Act.
Division 2--Functions of an electricity distributor
Proposed section 6C sets out the principal functions of the electricity distributors.
Their main business is to purchase electricity and to supply and distribute it within
their respective districts. They have a duty to promote the safe and efficient use, and
the conservation, of electricity.
Proposed section 6D gives the electricity distributors certain ancillary functions,
for example, powers to acquire land, construct plant etc.
Proposed section 6E specifies certain duties of an electricity distributor, including
carrying out its duties efficiently and economically, promoting standardisation of
systems and equipment for the supply of electricity and supplying electricity on
equitable terms and rates to customers.
Proposed section 6F provides that an electricity distributor may exercise its
functions outside the distribution district on certain conditions.
Proposed section 6G allows an electricity distributor to delegate its functions to
authorised persons and permits sub-delegation with the written consent of the
distributor.
Division 3--Electricity distributor policy and practice
Proposed section 6H provides that the principal function of the board of directors
of an electricity distributor is to determine the policies of the distributor. In
discharging this function, the board has a duty to see that the electricity distributor
functions properly and efficiently and in accordance with sound commercial practice.
Proposed section 6I provides for Ministerial control and direction of electricity
distributors. The Minister may give the board of a distributor written directions in
relation to the exercise of the distributor's functions. The board may request the
Minister to review the direction if it considers that the distributor would suffer a
significant financial loss as a result of complying with the direction and if the
direction is contrary to a performance agreement or is not in the distributor's
commercial interests. After review, the Minister may confirm or revoke the direction.
Proposed section 6J requires an electricity distributor to supply the Minister from
time to time with information concerning its activities.
Proposed section 6K requires an electricity distributor to invite tenders before
entering into certain contracts.
Proposed section 6L requires an electricity distributor to invite tenders, and
prepare a tender itself, for the provision of goods, materials, services, facilities or
works costing $250,000 or more or such greater amount as is prescribed by the
regulations. The provision does not apply in the case of an emergency or to goods,
materials, services, facilities or works exempted by the Minister by order published
in the Gazette.
Proposed section 6M provides for performance agreements to be entered into
between the Minister and an electricity distributor. These are agreements that set
operational performance targets for the distributor. A performance agreement will
require a distributor to prepare and submit to the Minister a corporate plan. The
corporate plan is to guide the distributor in the conduct of its activities. It must
specify the objectives of the distributor in relation to each aspect of its business
affairs.
Division 4--Constitution of boards
Proposed section 6N provides for the constitution of a board of directors for each
electricity distributor and gives effect to proposed Schedules 8 and 9, which relate to
directors and meetings of the board.
Proposed section 6O describes the composition of a board of directors of an
electricity distributor. It consists of persons elected or nominated, by the relevant
local government councils, as prescribed by the regulations and persons appointed by
the Minister.
Division 5--General manager and staff
Proposed section 6P provides that there is to be a general manager of each
electricity distributor and specifies the functions of the general manager. The general
manager is to be generally responsible for the efficient and effective operation of the
distributor's organisation.
Proposed section 6Q enables an electricity distributor to employ staff and gives
effect to proposed Schedule 10 which contains provisions relating to the employment
of staff.
Division 6--Finance
Proposed section 6R requires an electricity distributor to establish a General Fund
and a Trust Fund.
Proposed section 6S provides for payment of non-trust money received by an
electricity distributor into its General Fund and for payment out of that fund of the
ordinary operating expenses (including salaries etc.) of the distributor.
Proposed section 6T provides for payment into an electricity distributor's Trust
Fund of trust money received by the distributor.
Proposed section 6U provides for the investment by an electricity distributor of
money held by it.
Proposed section 6V enables regulations to be made with respect to accounting
methods to be employed by an electricity distributor.
Proposed section 6W requires the receipts of an electricity distributor to be banked
in New South Wales.
Proposed section 6X prescribes the financial year of an electricity distributor as
the' year commencing on 1 July, unless the Treasurer determines another financial
year under the Public Finance and Audit Act 1983.
Division 7--Entry and inspection
Proposed section 6Y defines "authorised person" for the purposes of the proposed
Part.
Proposed section 6Z provides for the appointment by an electricity distributor of
authorised persons and for the issue to them of a certificate of their authority, which
they are obliged to produce to the occupiers of premises and other interested parties
when exercising their functions under the proposed Act,
Proposed section 7 gives an authorised person a right to enter premises at
reasonable hours to install or read a meter or do other things necessary to ascertain
that an electricity distributor's tariff conditions etc. are being observed.
Proposed section 7A requires advance notice to be served on the occupier of
premises when an authorised person enters land or a building in the exercise of his or
her functions.
Proposed section 7B authorises the use of reasonable force by an authorised
person to gain entry, if necessary, in accordance with the powers conferred on the
person.
Proposed section 7C requires notification to be given to interested parties
whenever force has been used to enter any premises and advance notice has not been
given.
Proposed section 7D requires an authorised person to do as little damage as
possible in the exercise of functions conferred on the person and to provide
alternative means of access to premises where this is necessary.
Proposed section 7E allows an electricity distributor in certain cases to recover the
costs of entry from the owner or occupier of land that it has had to enter by force.
Proposed section 7F requires an electricity distributor to pay compensation for
damage caused by it under the proposed Part, except damage from work done for the
purposes of an inspection.
Proposed section 7G enables an electricity distributor to discontinue supply to any
person who will not give the distributor access to his or her premises for checking the
meter or installing any necessary equipment or for similar purposes.
Division 8--Miscellaneous
Proposed section 7H confers power on an electricity distributor to acquire land.
The power is exercisable under the Land Acquisition (Just Terms Compensation) Act
1991.
Proposed section 7I provides for the formation by two or more electricity
distributors of companies, known as special purpose companies, in order to carry out
joint ventures in relation to any of their functions.
Proposed section 7J allows an electricity distributor to discontinue supply to a
person who will not pay the charge for electricity supplied.
Proposed section 7K confers on an electricity distributor the power to dig up
roads, put up structures and erect power lines.
Proposed section 7L provides that, for the purposes of any building approval
required under the Local Government Act 1919 for the erection or placement of an
electricity distributor's electrical wires, poles and other equipment, the distributor is
to be the approving authority.
Proposed section 7M exonerates an electricity distributor from liability for any
charge by a local government council in connection with its placement of wires,
poles and other equipment within a local government area.
Proposed section 7N authorises an electricity distributor to require the owner of a
conduit (for example, a pipe or cable) in or under a road or reserve to make an
alteration to the conduit. Such alterations are to be made at the distributor's expense.
Proposed section 7O empowers an electricity distributor to abate any nuisance in
the nature of an obstruction to any of its works, to repair damage caused by any such
obstruction and to recover the cost of doing so from the person responsible for the
obstruction.
Proposed section 7P prevents any structure or fitting of an electricity distributor
that is erected or fixed on land from being taken in execution of a judgment against
the owner of the land (unless it is the distributor itself).
Proposed section 7Q permits an electricity distributor to waive or refund the
whole or part of any charge or other money due to it.
Proposed section 7R provides that a function exercised by an electricity distributor
or a delegate of the distributor is not invalidated if it is exercised contrary to a
direction of the Minister.
Proposed section 7S exonerates from personal liability the directors of an
electricity distributor and persons duly acting under direction for any matter or thing
done in good faith in the execution of official duties.
Proposed section 7T permits an electricity distributor to join an industry
association.
Proposed section 7U permits an electricity distributor, with the approval of the
Minister, to adopt a trading name.
Proposed section 7V makes provision for the custody and use of the seal of an
electricity distributor.
Proposed section 7W provides for the service of documents on an electricity
distributor.
Proposed section 7X enables an electricity distributor to recover charges etc. as
debts.
Proposed section 7Y enables the Minister to transfer any assets, rights and
liabilities of an electricity distributor whose distribution district is changed by
regulation under proposed section 6A to another electricity distributor.
Proposed section 7Z provides that the Governor-in-Council may by proclamation
dissolve a county council established under the Local Government Act 1919 that has
electricity supply functions or declare, in relation to other county councils and local
government councils that at present have electricity supply and other functions, that
they no longer have electricity supply functions.
Schedule 1 (18) inserts proposed Part 5A. The provisions of that Part are as follows:
PART 5A--CONDITIONS OF ELECTRICITY SUPPLY
Proposed section 26A defines certain terms for the purposes of the proposed Part.
Proposed section 26B gives a person a right to be provided with electricity supply
or capacity increase from an electricity distributor if the person meets the cost of
connection or makes a contribution to the cost in accordance with guidelines issued
from time to time by the Energy Corporation in consultation with the Government
Pricing Tribunal. A right of appeal is provided in accordance with the regulations.
Proposed section 26C requires an electricity distributor to formulate general
conditions of supply that are not inconsistent with the Act. A copy of the conditions
is to be made available for inspection free of charge.
Proposed section 26D treats a person who applies for or receives supply from an
electricity distributor as having entered into an agreement containing the general
conditions of supply. An electricity distributor may enter an alternative agreement
with a person. An electricity distributor is entitled to refuse, suspend or discontinue
supply if a person contravenes the conditions of an agreement.
Proposed section 26E allows an electricity distributor to require security from a
customer.
Proposed section 26F permits an electricity distributor to require the installation of
metering equipment in connection with the supply of electricity.
Proposed section 26G permits an electricity distributor to require the installation
of service equipment necessary or ancillary to the supply of electricity.
Proposed section 26H enables an electricity distributor to affix seals to a
customer's installation.
Proposed section 26I provides for the estimation of the quantity of electricity used
in cases where the metering equipment has not properly registered the quantity.
Proposed section 26J enables an electricity distributor to install service lines.
Proposed section 26K allows an electricity distributor to impose certain
requirements on customers relating to the installation and use of electrical appliances
and equipment, the location and accessibility of metering and service equipment and
other matters in connection with the use and supply of electricity.
Proposed section 26L permits an electricity distributor to discontinue supply to a
person who connects an installation to the electricity distributor's mains without
permission or causes the person's supply of electricity to be incorrectly metered.
Proposed section 26M enables an electricity distributor to make certain
requirements as to the installation of equipment in cases where the supply required is
in excess of that which can be provided by service line from its street mains.
Proposed section 26N allows an electricity distributor to require a person to pay
for the whole or a part of the costs incurred for supplying electricity or increasing the
supply of electricity to the person.
Proposed section 26O entitles an electricity distributor to interrupt supply at
reasonable times for the purpose of maintenance work, repairs or testing.
Proposed section 26P exonerates an electricity distributor from liability for loss
suffered through a failure to supply or a defect in supply caused by a breakdown in
machinery o r by other causes not within the control of the distributor.
Proposed section 26Q requires a customer to give an electricity distributor 48
hours' notice that the supply be discontinued otherwise the customer remains liable
for all charges for supply until 48 hours after the distributor is informed or until the
supply can be discontinued or transferred, whichever happens first.
Proposed section 26R creates offences for damaging or tampering with equipment
and installations of an electricity distributor.
Proposed section 26S enables an electricity distributor to refuse, suspend or
discontinue supply to any person who contravenes the Part.
Proposed section 26T applies the Part to Sydney , Electricity.
Schedule 1 (24) extends the regulation making power under the Act to certain
matters, including matters relating to the transmission, distribution and use of electricity
and the restriction or regulation of the removal or trimming of trees by electricity
distributors or Sydney Electricity.
Schedule 1 (26) inserts Schedules 71 1. Those Schedules contain the following
provisions:
SCHEDULE 7--ELECTRICITY DISTRIBUTORS
Schedule 7 names the electricity distributors and specifies their distribution
districts.
SCHEDULE 8--BOARDS OF DIRECTORS
Schedule 8 contains provisions relating to the directors of an electricity distributor,
including the terms of office of directors and a requirement for a disclosure of
pecuniary interests.
SCHEDULE 9--BOARD MEETINGS
Schedule 9 contains provisions relating to the procedure at meetings of a board of
directors of an electricity distributor.
SCHEDULE 10--STAFF OF ELECTRICITY DISTRIBUTORS
Part 1--Staff generally
Clause 1 provides that an electricity distributor may employ staff and has power,
subject to any industrial awards or agreements, to determine the wages and
conditions of its staff.
Clause 2 provides for regulations to be made as to the conditions of employment
and discipline of an electricity distributor's staff. The regulations are subject to
awards and agreements.
Clause 3 allows an electricity distributor to obtain the services of other public
sector employees by secondment or otherwise.
Clause 4 allows an electricity distributor to engage consultants.
Part 2--Organisation structure
Clause 5 requires an electricity distributor to determine an organisation structure.
Clause 6 allows an electricity distributor to re-determine its organisation structure
from time to time.
Part 3--The general manager and senior staff
Clause 7 provides for the appointment of the general manager of an electricity
distributor and of an acting general manager if the need should arise. The general
manager is to be appointed by the Governor, on the recommendation of the Minister
and the nomination of the distributor.
Clause 8 requires consultation with the electricity distributor when the general
manager of an electricity distributor is appointing or dismissing its senior
management staff.
Clause 9 provides that the appointment and terms of employment of senior staff of
an electricity distributor are, subject to the proposed Act, to be in accordance with
any guidelines issued by the Minister.
Clause 10 requires senior staff of an electricity distributor to be appointed on
performance-based contracts.
Clause 11 requires the general manager of an electricity distributor to report
annually on the contractual conditions of the distributor's senior staff.
Clause 12 provides that the employment of the general manager and senior staff of
an electricity distributor, since it is to be on a contract basis, is not subject to any
industrial award or agreement.
Clause 13 imposes a duty on the general manager and senior staff members of an
electricity distributor to report bankruptcy.
Part 4--Equal employment opportunity
Clause 14 states the objects of the proposed Division.
Clause 15 requires an electricity distributor to prepare and implement an equal
employment opportunity management plan.
Clause 16 provides that the terms of an equal employment opportunity
management plan prevail over the provisions of the Anti-Discrimination Act 1977 to
the extent of any inconsistency.
Clause 17 allows the Minister to refer any aspect of an electricity distributor's
equal employment opportunity management plan to the Anti-Discrimination Board if
the Minister is not satisfied with it.
Part 5--Other provisions concerning staff
Clause 18 requires advertising of staff positions to be filled in an electricity
distributor.
Clause 19 requires appointments of staff to be made on a merit basis.
Clause 20 states that clauses 18 and 19 do not apply to appointment by way of
demotion or lateral transfer unless the electricity distributor otherwise decides.
Clause 21 provides that a member of staff of an electricity distributor is not
subject to directions of the distributor in relation to the contents of any advice or
recommendation made by the member.
Clause 22 prohibits employees of an electricity distributor from taking on outside
employment except with the approval of the general manager of the distributor or, in
the case of the general manager, except with the approval of the board of directors of
the distributor.
SCHEDULE 11--SAVINGS, TRANSITIONAL AND OTHER PROVISIONS
Schedule 11 contains savings, transitional and other provisions.
Schedule 1 (l), (2), (5)-(17), (19)(23) and (25) contain consequential amendments.
SCHEDULE 2--MISCELLANEOUS AMENDMENTS TO ELECTRICITY
ACT 1945
Amendments relating to stray current sources
The Act currently provides for the regulation of cathodic protection systems and
confers certain rights of entry onto premises in which they are located. Cathodic
protection systems are devices that inhibit the electrolytic corrosion of metallic
structures that are attached to, or embedded in, the earth. The need to regulate those
systems arises from their propensity to exacerbate the electrolytic corrosion of metallic
structures in the vicinity of the structures they protect. Similar problems arise with other
devices, commonly known as "stray current sources".
Schedule 2 (1) defines the expression "stray current source". Schedule 2 (10)
provides for the regulation of stray current sources. Schedule 2 (8) confers certain rights
of entry onto premises in which stray current sources are located. The effect of those
amendments will be to put stray current sources on the same footing as cathodic
protection systems.
Constitution of the Electricity Council
Schedule 2 (2) reduces the membership of the Electricity Council of New South
Wales from 17 to 16 members by removing the Secretary of the Department of Local
Government from the list of official members.
Lighting of traffic routes etc.
Schedule 2 (3) removes from the list of specified powers of the Energy Corporation
of New South Wales the promotion of the installation, extension and improvement of
the lighting of public roads.
Schedule 2 (6) removes provisions which establish a Traffic Route Lighting Subsidy
Account funded by the Energy Corporation from the Electricity Development Fund and
the Roads and Traffic Authority. The power of the Energy Corporation to grant
subsidies to local government councils, county councils and Sydney Electricity for the
lighting of traffic routes is also removed, as well as a similar power in relation to the
granting of subsidies from the Subsidy Account towards the cost of removing or
relocating electricity structures for the purposes of traffic safety (Schedule 2 (7)).
Schedule 2 (6) also omits a provision which links the annual contribution of
electricity supply authorities in relation to the lighting of traffic routes in their area with
the subsidies paid to the councils of those areas from the Traffic Route Lighting Subsidy
Account. A new provision is included which enables the Minister in consultation with
the Minister administering the Traffic Act 1909 to determine the annual contributions by
electricity distributors and Sydney Electricity for the lighting of traffic routes.
Amendments made to the Traffic Act 1909 by Schedule 3 provide for the Roads and
Traffic Authority to make available money for annual subsidies to councils for traffic
route lighting and removal or relocation of electricity structures for traffic purposes.
Insurance
Schedule 2 (4) enables the Energy Corporation to enter into, or arrange for an
electricity supply authority to enter into, a self-insurance scheme in which money is set
aside to indemnify the authority against any prescribed liability, loss or damage
(specified in the scheme) that is incurred or sustained by the authority.
Schedule 2 (5) gives the Corporation power to invest, in certain authorised securities,
money in the Electricity Development Fund which was paid for insurance or self-
insurance purposes and is not required for the payment of premiums.
Delegation of functions
Schedule 2 (9) enables the Minister to delegate the functions of the Minister under
the Act.
SCHEDULE 3--AMENDMENT OF OTHER ACTS
Schedule 3 contains amendments to other Acts consequent on the enactment of the
proposed amendments to the Electricity Act 1945.