Economic Regulation Authority
What is the Economic Regulation Authority (ERA) all about?
Utility industries, such as those providing electricity, gas, water and rail services, deliver essential services to businesses and households in Western Australia.
These industries are often “natural monopolies” involving large infrastructure items such as pipelines and rail or power networks - which are uneconomic to duplicate and have traditionally (although not always) been owned by government.
Regulation is necessary to ensure that “natural monopolies” do not exert market power to the detriment of consumers and to realise the benefits from competition and achieve outcomes that are in the best interest of the community.
The Government recently established the Economic Regulation Authority, a single independent regulator responsible for overseeing economic regulation functions across the gas, water, rail and electricity industries in Western Australia.
The ERA’s core functions are:
- independently regulate access terms and conditions for significant economic infrastructure (such as gas and rail networks) under industry specific access regimes;
- independently grant and administer industry licences and ensure compliance with applicable terms and conditions; and
- make expert recommendations to government regarding tariffs and charges for utility services, and any other matters requested by the Government.
The roles and responsibilities of the ERA are set out in the Economic Regulation Authority Act 2003.
The ERA will promote transparent and accountable regulation that is fair to both consumers and to investors in utility industries.
Establishment of the ERA was about institutional change, not about changing the rules or focus of existing regulation.
Institutional change was needed because existing economic regulatory functions were fragmented as they were undertaken by a range of sector-specific regulators and public sector officials.
These included the Gas Access Regulator, Independent Rail Access Regulator, Coordinator of Water Services and Coordinator of Energy.
The problem of fragmentation is accentuated with multi-utilities now emerging to provide even greater choice to consumers by supplying services across more than one market (such as gas and electricity).
Stakeholders have lobbied for a more cohesive and efficient regulatory framework for some time, and for a regime that is flexible enough to respond to changing regulatory needs.
An extensive consultation process was conducted with a variety of Ministers, government agencies, affected businesses, industry representatives and community interest groups during the establishment of the ERA.
A public consultation process on the Government’s proposal for the ERA was undertaken in early 2002. Details on the public consultation process.
Read about the benefits of the ERA.
Further information regarding the activities of the ERA can be found at the Authority's website.