Australia’s embedded network landscape is a peculiarly intricate tangle of nuance, complexity and regulatory optimism. Note that the embedded networks are distinctly unique and different from retail utility providers.

Please bear with my lengthy explanation for a few rather long moments.

Embedded networks are private distribution systems sitting behind a single connection to the public grid (shopping malls, apartment blocks, retirement villages, camp and caravan sites etc). They all have, effectively, a single wire going into the site.

Originally, they were designed for incidental on-selling by site managers, and they are a regulatory exception allowing the operator to on-sell electricity and other services without becoming a fully authorised energy retailer or licenced distributor. The embedded networks typically bundle: 1) electricity, 2) centralised hot water, 3) cold water, 4) gas, 5) heating / cooling (air-conditioning) and 6) fibre to the premises (sometimes, not always). All those things are governed by separate statutes.

In theory as well as occasionally in practice, they should be cheaper for consumers because they are able to negotiate lower wholesale rates from the upstream supplier and because the customer churn is non-existent (the customer is locked into the network and has nowhere to go). In some cases, that is indeed true, but because the current legislation explicitly excludes the embedded networks from the government reporting, many embedded network operators have resorted to the insidious exploitation of their customers, and the government is clueless because the operators' imposed pricing is opaque.

Natiaonally, Australia does not have a single federal embedded-network statute. The principal framework is a cooperative national scheme comprising 7 government bodies (Australian Energy Market Commission, AER, Australian Energy Market Operator, National Electricity Law and Rules, National Energy Retail Law and Rules, Australian Consumer Law and Australian Competition and Consumer Commission).

At the state level – so far – only Victoria has largely banned new embedded networks, with the remaining states either participating or not participating in the National Energy Customer Framework. Overall, NSW, Victoria, Western Australia and the national regulators are tightening the rules but they still have a way to go.

For a reform such as embedded-network regulation, the path looks closer to:

  Voters ↝ political parties ↝ MP's ↝ ministers ↝ departments ↝ intergovernmental bodies ↝ regulators ↝ consultation processes ↝ rule-making bodies ↝ implementation.

Unsurprisingly and consequently, politicians become heavily dependent on: a) departmental advice, b) regulator advice, c) industry submissions, d) consultant reports, and e) lobby groups.

The people who understand the system – and especially those one who know how to work the system to their benefit – therefore acquire disproportionate influence over how the system evolves. That does not necessarily imply corruption, it is a structural feature of technical governance. Customers, however, refer to it as «rent seeking», even if they own an apartment.

Despite all that, elected representatives still do remain one of the few machineries capable of changing the underlying legal framework. The deeper issue is that modern regulatory states are neither pure democracies nor pure technocracies – they are hybrids. Formal authority remains democratic, but practical power is distributed among elected officials, bureaucracies, regulators, courts, industry participants, consultants, lobbyists and organised interest groups.

I have recently gone down the rabbit hole of the embedded networks and learned a bewildering number of things hence the fulmination.

Because their place of residence is connected to an embedded network that has eschewed the NBN Co and chosen to connect to a private fibre operator who sits outside the NBN. They probably also pay more compared to NBN for the same speed.

Not every embedded network supplies fibre, but some do, and that appears to be the case in their situation.

By the way, NBN has recently upgraded the network to 2Gbps, with 10 Gbps having been trialled but no availability date set as of yet.

He decided it was waaaaay too expensive and big-governmenty to do that and besides, Uncle Rupert had a satellite tv business to defend, we don't want him to have to compete with the likes of Netflix now do we? So he told Australia that it was too much money for a "glorified video delivery service" and that 25Mbit was enough for anyone for the foreseeable, and threw out the original plans.

The plan was downgraded to "Fibre in some places, we'll reuse copper where possible". This ended up taking longer and costing more than the original plan, delivered worse service, and we're only now getting towards where we should have been under the first plan. A lot of the work has had to be repeated due to the initial poor rollout and then needing to upgrade as that 25Mbit started looking woefully inadequate. Just last year a further $5 billion was pledged to replace more FTTN/Copper with FTTP.

It's still more expensive than other markets I'm aware of, a lot of people who aren't far from cities and major towns are on wireless connections (theoretical 400Mbit, actual ~150), and the real bush "Sky Muster" system tops at 100/5 (actual ~55-83) and is having its lunch eaten by starlink.

tl;dr the Liberal (conservative) party got in and fucked it up.

I got into a dispute with my embedded provider because of a bad meter and came to discover through friends and family in the construction industry as well as speaking to a former sales person in the industry that there is a lot of additional corruption in the process with straight up payments being made to win installs with developers.

When it came time to switch providers in our building, strata was promised electric vehicle chargers as part of signing a new deal with a new provider. They never delivered because they found an escape clause because of fire safety approval.

We're now locked in for years (again) and they've already increased rates once in the first year.

Nobody in the entire chain works in the interests of residents or owners. It's a completely broken system and a thorn in the side of otherwise advanced and progressive Australian energy policy. It needs to be abolished ASAP.

I still pay more for my single apartment living alone in electricity than what family and friends do in full large homes with air conditioning, 4-6 residents, heated pools, etc. It's astonishing.