WIN Connect is one of Australia's largest providers of embedded networks, which is where a private company powers multiple properties in the same building.
What is an embedded network?
- A company is contracted to provide a private energy network to an apartment block
- The power is bought in bulk from grid at a single meter point and sold to occupants through sub meters
- Metering and infrastructure provided by company reduces costs for developer but ties occupants to long contracts
- Customers can be charged for switching electricity suppliers on their own and will still get service charges
- All metering needs to be changed if whole building changes supplier
"It is quite difficult as you need to assess who the meters belong to and you either need to buy them back or get new ones," Mr Renard said.
"You need to hire lawyers to help, it's extremely complex and time consuming."
Mr Renard said residents in his West Melbourne building will have to pay $50,000 to replace the metering if they switch energy providers, but will save money in the long run.
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Urgent reform needed 'before it's too late'
An embedded network essentially involves a contract between the building owners, sometimes the developer, and an energy retailer to supply power to those living in the building.
Developers save costs by contracting electricity companies to supply the infrastructure and the metering throughout an apartment complex.
In return, the energy company is contracted to provide power to the whole building, which can tie customers to lengthy contracts, some as long as 20 years.
Under the contract, the company managing the embedded network can set prices on electricity tariffs, and if the agreement is terminated they may remove the meters from the building.
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Mr Bacon said while embedded networks operated on the presumption of lower costs, the power companies could charge any fees they liked and trap customers within the network.
"Unless there is urgent reform, not next month, not next year, but right now then it is going to be too late, he said.
Mr Bacon said high-rise dwellers would often discover they were caught up in lengthy contracts they did not know existed
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