Victoria’s electricity distribution network service providers (DNSPs) could soon be forced to reckon with new constraints that challenge ‘business-as-usual’, and those constraints may actually unlock freer, smarter market innovation.

Two recent AER decisions impacting Victorian DNSPs set out tight rules around a kerbside EV-charging trial and create a new regulated service to provide fair access to DNSP poles for electric vehicle charging infrastructure (EVCI).

These restrictions are not a brake on innovation, but are guardrails that will enable more innovation and competition, and they raise the question: Should the rest of the National Electricity Market (NEM) follow?

Kerbside EV-charging: A tightly-conditioned waiver

In October 2025, the Australian Energy Regulator (AER) granted a ring-fencing waiver to CitiPower/Powercor/United Energy (collectively CPU) to install up to 100 kerbside EV chargers (including at least 5% vehicle-to-grid capable) in their Victorian distribution areas.

However, the waiver comes with nine strict conditions, aimed at preserving fair access, transparency and competition. These include obligations on the CPU to offer third-party access to poles and sites, report publicly on trial data, maintain non-discrimination in pricing and accept that the trial will end by mid-2031, unless extended.

The result: While the DNSPs get permission to innovate, they also face significant constraints and must commit to safeguarding third-party access and competitive outcomes.

Classification of asset-rental services: opening up the poles

In its draft decisions for the 2026-31 regulatory period for Victorian DNSPs (AusNet Services, Jemena, CitiPower, Powercor and United Energy), the AER proposed to classify “distribution asset rental – rental of distribution assets (e.g., poles) to third parties for EV chargers or associated hardware” as a negotiated distribution service.

The practical effect: DNSPs must negotiate access to pole-rental arrangements under regulated frameworks and criteria. Previously, pole access may have been provided under standard control services, or outside formal classification, leading to less transparency, higher risk of preferential treatment and/or barriers to entry by third parties.

By requiring negotiation and oversight, the AER is embedding contestability and third-party access, thereby fostering an environment in which non-DNSP innovators (EV-charging providers, service aggregators, smart-grid tech) can engage with infrastructure, rather than being shut out or locked into network-owned solutions.

Should this be applied across the NEM?

Yes, and arguably, it must. The NEM is facing mass transformation, including electric vehicles, distributed energy resources, smart meters, V2G (vehicle-to-grid) and flexibility markets. Left unchecked, DNSPs could become gatekeepers, limiting competition, innovation and choice.

• Asset rental classification: Network-owned assets, such as poles, ducts and rights-of-way, should be made accessible, under negotiated frameworks, enabling third-party access and reducing barriers to market entry.
• Transparent access & cost-reflective pricing: Access agreements must ensure that charges and terms for third parties are cost reflective and eliminate hidden cross-subsidies or locked-in monopoly advantage.

Conclusion

The restrictions placed on Victorian DNSPs by the AER might seem heavy-handed. But in reality, they provide a structured, fair environment for innovation, protecting competition while enabling new services.

If applied across the NEM, they could help transform the network business model, from closed, utility-led, infrastructure expansion, to an open, competitive ecosystem of new entrants and services.

Free-market innovation doesn’t mean unregulated everything; it means smart regulation that opens doors, not just shuts them. In that sense, Victoria’s reforms.

This article was written by NECA director, policy, technical and safety, Neil Roberts.