Regulatory Changes for Embedded Networks Are Now Live
Since 1 July 2026, significant reforms introduced by both the Australian Energy Regulator (AER) and the Independent Pricing and Regulatory Tribunal (IPART) have come into effect for embedded networks across Australia, with major implications for strata communities.
For strata managers, these reforms represent a significant shift in how embedded networks are regulated and managed. One of the most significant changes is that the National Energy Retail Law now extends beyond electricity and gas to also cover hot water and centralised air conditioning supplied through embedded networks. Services provided by embedded network operations are now subject to energy-style pricing, billing, disclosure and dispute resolution obligations.
While embedded networks have long delivered infrastructure and cost efficiencies for apartment buildings, mixeduse developments and retirement communities, the reforms introduce stronger customer protections, greater transparency, standardised billing practices and increased regulatory oversight. This places greater emphasis on compliance, customer communication and operational accountability for owners corporations and strata managers.
AER reforms strengthen customer protections nationally
The AER reforms introduce several new obligations for exempt sellers and embedded network operators nationwide.
Embedded network operators and exempt sellers must now provide Energy Ombudsman details on customer bills and maintain membership with the relevant ombudsman scheme, aligning embedded network customers with the same external dispute resolution protections available in the broader energy market.
The reforms also introduce stronger pricing transparency requirements, such as enhanced tariff disclosures and, in some cases, comparisons with local retailer standing offers, for residential and small commercial customers within embedded networks. Another important reform is the introduction of annual reporting obligations. Starting July 2026, embedded network operators will need to report customer numbers and operational data to the AER annually. This new requirement aims to enhance regulatory oversight by tracking compliance patterns, identifying potential risks, and addressing customer issues sooner.
Collectively, these national reforms signal a clear regulatory direction: embedded network customers are increasingly expected to receive protections and transparency comparable to those available in the traditional energy retail market.
NSW reforms give IPART stronger enforcement powers
Alongside the national AER reforms, New South Wales (NSW) has introduced substantial regulatory changes through IPART.
The NSW reforms significantly expand IPART’s authority over pricing, compliance and customer protections within embedded networks. This includes electricity, gas, hot water and centralised air conditioning supplied through embedded networks, including the ability to set maximum pricing limits for those services.
These changes address ongoing concerns about inconsistent pricing and limited oversight in some networks. For strata schemes with embedded networks, these reforms mean strata managers will need to review pricing structures carefully to ensure compliance with future pricing determinations from IPART.
IPART is also developing mandatory billing standards to improve consistency and transparency across NSW embedded networks. These reforms aim to simplify bills for residents, especially in strata communities, where complex fee structures and usage calculations often lead to confusion and disputes.
Another major reform is the requirement for embedded network operators to become members of the Energy and Water Ombudsman NSW. This aligns embedded network customers with the same external dispute resolution framework available to customers in the broader energy market.
The NSW reforms also introduce enhanced disclosure obligations. Operators must now publish key information online, including pricing details, premises served and the commodities supplied at each site. Operators supplying centralised air conditioning systems must also publish prescribed efficiency and consumption information relating to those systems.
Importantly, IPART will also receive stronger investigative and enforcement powers, including expanded compliance monitoring capabilities and the ability to impose significant penalties for non-compliance.
What this means for strata managers
For strata managers, the reforms are likely to create a more compliance-focused operating environment.
While many direct obligations fall on embedded network operators and exempt sellers, strata managers will increasingly play an important role in supporting compliance, managing resident expectations and facilitating communication between building stakeholders and service providers.
This may include assisting with resident communications regarding billing changes, coordinating updates to disclosure information and responding to residents’ concerns, while owners corporations might face more inquiries from residents seeking clarity on pricing methods.
As regulatory scrutiny increases, proactive engagement with embedded network providers will become increasingly important. Strata managers should ensure operators are reviewing their billing systems, customer communications, dispute resolution procedures and compliance frameworks to meet the new requirements.
These reforms reinforce the growing expectation that embedded networks must deliver not only operational efficiencies, but also transparent and customer-focused outcomes.
At Active Utilities, we support reforms that improve transparency, accountability and consumer protections in embedded networks. As regulations change, we remain committed to helping strata communities stay compliant, improve customer experiences, and adapt to industry changes.
For more information about how these reforms may affect your building, compliance obligations or customer communications, contact Active Utilities at sales@activeutilities.com.au.
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