Commonly asked questions about residential community electricity

In an embedded electricity network, the wires from the electricity retailer run to the boundary of the residential community. The homeowner’s residential site is then supplied with electricity by the operator’s network of wires. The electricity retailer has an account with the operator, not the individual homeowners.

In an embedded network, the homeowner receives their electricity bill from the operator who works out electricity charges for each homeowner as a share of the bill received from the electricity retailer for the whole residential community.

If a residential community, does not have an embedded network, the homeowner is connected directly to the electricity retailer. They receive their electricity bill from the electricity retailer.

Residents can only be charged a daily supply charge and usage charge for electricity that is up to the median retail market offer for their distribution area.

The offer is determined by the Independent Pricing and Regulatory Tribunal (IPART) at least once every 12 months.

An operator must review their electricity supply contract and compare the contract’s electricity price with the price under at least one other comparable contract from another electricity retailer. Operators must do this to ensure they are getting the best available offer for their embedded network.

Operators must do this once every 2 years unless a contract is longer. If a contract is for more than 2 years, operators only need to do the review before they enter a new electricity supply contract.

Within 30 days of finishing the review, residents must be given written notice of the details of the:

• electricity prices and contracts that were considered in the review
• outcome of the review.

Under section 83 of the Residential (Land Lease) Communities Act 2013 (the Act), homeowners have the right to see an operator’s electricity bill or other documents that relate to how much they are charged for utilities like electricity.

Operators can provide access to their electricity bill in a number of ways. For example, a copy of their bill could be provided on request (with reasonable notice) or put on display in the office at the residential community, or the operator could email a copy to homeowners.

If homeowners are having problems getting access to bills or other documents about utility charges, they should attempt to discuss this with the operator first. If this is not successful, they can contact NSW Fair Trading or the Energy & Water Ombudsman NSW (EWON) for help.

Before an operator or third-party supplier can charge a resident for electricity, they must ensure that:

• the usage is separately measured or metered
• they provide an itemised account to a resident, and give residents a minimum of 21 days to pay.

If these requirements are not met, the resident is not required to pay the electricity usage charges.

Homeowners, tenants, operators and third-party suppliers may contact:

• Energy and Water Ombudsman of NSW (EWON) - 1800 246 545
• NSW Fair Trading - 13 32 20
• Tenants’ Union of NSW (TU)
• Land Lease Living Industry Association of NSW (LLLIA)
• Affiliated Residential Park Residents Association (ARPRA)
• LawAccess NSW - 1300 888 529

The NSW Government has rebates and appliance replacement offers that may help people on low incomes living in residential communities to pay their electricity and gas charges.

More information about these rebates, who can claim them and how to apply for them is available from Service NSW.

Call 137 788 or find an energy rebate.

Operators can choose how to calculate their electricity charges as long as the homeowner is not charged more than the operator has been charged for the electricity they use.

The Associated Residential Park Residents’ Association (ARPRA), Land Lease Living Industry Association of NSW (LLLIA), the Energy & Water Ombudsman NSW (EWON) and the Tenants’ Union of NSW (TU) support a calculation method known as the 'Reckless' method.

This method was used by the NSW Civil and Administrative Tribunal (the Tribunal) in the case: Reckless v Silva Portfolios Pty Ltd t/as Ballina Waterfront Village and Tourist Park (No. 2) [2018] NSWCATCD 59.

To apply the 'Reckless' method, all charges in an operator’s bill are combined, and then divided by the total number of kilowatt hours the operator has been charged for the whole community. This results in a single per kilowatt hour (kWh) rate. To calculate the correct charge for the homeowner, the rate per kilowatt hour is multiplied by the total kilowatt hours used by the homeowner.

If an operator would like to replicate this method for their bills, the steps are:

1. Cost per Kilowatt Hour ($kWh) = total operator electricity cost for billing period ÷ total operator kilowatts hours used in billing period
2. $kWh × Total kWh used by resident = charge to resident

For example:

• The total bill for the operator is $1,000 and the residential community has used a total of 1,000 kWh for that billing period. This means a per kWh charge of $1.00 ($1000/1000 kWh = $1 per kWh). So, if a homeowner consumed 100 kilowatt hours of electricity in a billing period, they would be charged $100 ($1 per kWh x 100 hours = $100).

The Reckless method leaves the operator to pay for the electricity consumed in the common areas, as these are not included in the kilowatt hours consumed by a homeowner at their residential site.

For example, if 8 homeowners in a community each use 100 kilowatt hours, the operator collects a total of $800. If the operator’s bill is $1,000, there is a difference of $200 for electricity used in the common areas of the community. This difference is paid for by the operator.

The 'Reckless' method of calculating how much a homeowner is charged for electricity includes a number of fixed charges (which are not based on usage) in the overall amount. These fixed charges are equivalent to the service availability charge on a residential bill. This means that if an operator uses the 'Reckless' method, they cannot also charge homeowners a separate service availability charge.

Where a community has residential sites that are supplied with electricity that is less than 60amps, operators or homeowners may want to seek advice from NSW Fair Trading or the Energy & Water Ombudsman NSW (EWON) about how to take account of the low amperage provisions in clause 13 of the Residential (Land Lease) Communities Regulation 2015.

There are a number of methods, besides the 'Reckless' method, that an operator can use to work out how much a homeowner should be charged for electricity.

If an operator uses an alternative method to the 'Reckless' method, then a separate service availability charge may apply. If the operator charges a service availability charge, it needs to comply with existing requirements in the Residential (Land Lease) Communities Regulation 2015.

Operators may wish to consult with homeowners to agree on the method used to calculate electricity charges, in the residential community.

Operators should make clear to homeowners, the method they have used to calculate electricity charges.

If homeowners have concerns about how their bill was calculated, they should speak to the operator first. If they still have concerns after that, they can contact NSW Fair Trading or the Energy & Water Ombudsman NSW (EWON).

If a homeowner has a right to a repayment for overpaid electricity charges, it may be possible for the homeowner or the residential community’s residents committee, to negotiate with the operator on an amount that everyone agrees on. Both homeowners and operators may find that collective negotiations provide a quicker and more effective way to settle repayments than homeowners talking to the operator one-by-one.

Homeowners and residential community operators can use NSW Fair Trading’s existing mediation service to help with these negotiations. For further information about applying for this service, contact NSW Fair Trading on 13 32 20  or go to residential land lease community complaints and enquiries.

Homeowners can also still apply individually to the Tribunal for a decision on how much money the operator must repay for overcharging for electricity. However, there are costs as well as potential time delays involved in the Tribunal process.

Homeowners may wish to contact LawAccess NSW on 1300 888 529 for free legal advice about time limits that may apply, before lodging any Tribunal application. Visit the NSW Civil and Administrative Tribunal website for information on how to contact the Tribunal.

If negotiating a repayment, homeowners and operators can agree on how far back the repayment can go, depending on the circumstances at their residential community.

The earliest time a claim can start from is 1 November 2015, which is the date the Residential (Land Lease) Communities Act 2013 started.

If homeowners choose to apply to the Tribunal for a repayment order, the extent of repayment may depend on the specific circumstances of the case.

Yes. The homeowners can agree to this arrangement as part of any collectively negotiated outcome, or as part of any repayment ordered by the Tribunal.

Homeowners and operators can also agree to another solution, such as homeowners getting a credit on future bills or site fees they would have to pay.

It is best for both homeowners and operators to make sure that any arrangements like this are in writing, to avoid any confusion or uncertainty later on.

Homeowners may also want to ask their operator to give them an account showing how much they are going to be credited and a running balance as credits are used up.

When homeowners and residential community operators work together to agree on repayments, they can agree on the timing of these payments and put this in writing.

When the Tribunal orders that a repayment must be made, the Tribunal may tell operators and homeowners when those payments must be made.

If homeowners are concerned their operator is delaying a repayment, they can contact NSW Fair Trading on 13 32 20 or the Energy & Water Ombudsman NSW (EWON) on 1800 246 545.

Former homeowners who lived in a residential community after 1 November 2015 and paid electricity bills during that time may have the right to a repayment, if they were overcharged.

Any repayment to former homeowners can be part of a collectively negotiated outcome. This is something for current and former homeowners and operators to discuss and decide together.

Former homeowners can also apply to the Tribunal for a repayment. Time limits may apply.

Yes. Homeowners still need to meet the terms of their site agreement and pay their electricity bills. Homeowners should only stop paying bills if this is something the operator has agreed to.