Ring-Fencing

Ring-fencing is the requirement under the National Electricity Rules for Distribution Network Service Providers (DNSPs) to establish arrangements to segregate its business of providing prescribed services from its other business activities. This is intended to ensure that the DNSPs' other business activities cannot access, and use to its advantage, information from the regulated business activities that would not be available to competitors.

The Queensland Competition Authority monitored DNSP compliance with ring-fencing requirements, and has published Electricity Distribution - Ring-Fencing Guidelines and Regulatory Accounting and Information Guidelines.

DNSPs are required to submit annual Ring-fencing Compliance Reports for consideration by the Authority. From 1 July 2010, responsibility for ring-fencing compliance will transfer to the Australian Energy Regulator.