Reshaping how services balance community needs with long-term challenges is the focus of this government entity, seeking to manage water pricing regulation while providing future resilience.
In an industry often defined by engineering benchmarks and capital projects, Victoria’s Essential Services Commission is steering the conversation in a new direction. Under Chairperson Gerard Brody, water regulation is continuing to focus on fairness, transparency, and resilience, placing the long-term needs of consumers at the centre of pricing decisions.
Embedding consumer protection
“The ESC’s purpose is to promote the long-term interests of Victorian consumers regarding price, quality, and reliability of essential services,” Brody said.
With a career grounded in consumer advocacy, Brody is focused on proactive, evidence-led regulation. He believes in using data to identify risks early and acting before systemic issues escalate. Central to this approach is ensuring essential services remain inclusive, affordable, and responsive to all Victorians.
“There’s a strong community expectation for regulators to act decisively when industry conduct causes harm,” he said. “We’re not just reactive. We aim to be forward-looking and preventative.”
Brody’s emphasis on accessibility reflects a broader shift in how essential services are regulated – one that sees fairness and dignity not as optional extras, but as fundamental performance benchmarks.
Updated standards for better service
The Water Industry Standards were last updated in 2022 and came into effect in March 2023. According to Brody, these updates are crucial in ensuring equity and responsiveness in service delivery.
New provisions require retailers to offer tailored support to residential and small business customers facing payment difficulties. Utilities must now communicate using preferred methods identified case-by-case and shift the tone of reminders to be more sensitive rather than threatening.
Another critical reform was codifying that water supply restrictions or legal action must only occur as a last resort. The ESC has also introduced mandatory self-reporting of utility non-compliance, giving regulators earlier visibility of emerging issues.
“These changes give customers more breathing room and give businesses more responsibility to do the right thing before consequences escalate,” Brody said.
Supporting vulnerable customers
Addressing vulnerability isn’t just a box-ticking exercise – it’s embedded in the Commission’s work.
One example is the ESC’s ‘Safety by Design’ initiative, developed in partnership with Thriving Communities Australia, Safe and Equal, and the Centre for Women’s Economic Safety. The project aims to reduce risk for customers experiencing family violence and build sector-wide capability for inclusive service delivery.
“We’re working across the water and energy sectors to make safety a design principle, not an afterthought,” Brody said. “We’ve had substantial guidance from the water sector, and a recent report called Design to Disrupt proposed changes to embed safety into the very architecture of service design.”
These efforts reflect a more profound cultural shift toward trauma-informed practice and service equity. For regulators, that means not only setting expectations but also fostering partnerships that lead to long-term systemic change.
Monitoring performance and pricing
The ESC uses public transparency and structured accountability to keep water businesses on track with their promises. Each year, it publishes comparative performance data across a range of indicators, including service reliability, recycled water use, billing trends, and greenhouse gas emissions.
This data is now available through interactive dashboards to support utility benchmarking and public awareness.
A central part of the ESC’s regulatory framework is PREMO, which stands for Performance, Risk, Engagement, Management, and Outcomes. It connects water pricing with business performance and customer value.
“Incorporating performance measures into pricing makes explicit the connection between performance and pricing outcomes,” Brody said.
Businesses must report annually on how they’ve delivered against agreed customer outcomes. These outcomes are developed through customer engagement and submitted as part of five-year pricing proposals.
“It’s about drawing a direct line between what businesses promise and what they deliver,” he added.
Engaging stakeholders
“Engagement can’t be transactional. It needs to be ongoing and meaningful,” Brody said.
ESC commissioners regularly travel to meet with water utilities across the state, and they recently visited Wodonga to meet with North East Water.
Brody has also participated in forums with the chairs of Victoria’s water corporations through VicWater and hosts a community sector roundtable to include consumer advocates’ voices.
Alongside direct engagement, the ESC recently conducted an independent review of PREMO implementation. The findings are now being used to guide a new 18-month engagement program that will build shared understanding of the pricing framework and explore areas for improvement.
These stakeholder conversations are not just procedural. They are part of a longer-term strategy to ensure that the regulatory process is not siloed but embedded in the real-world experience of both providers and customers.
Encouraging innovation and sustainability
The PREMO framework also rewards ambition. Utilities demonstrating high customer value, efficiency and innovation can access higher returns, not to inflate pricing, but to reinvest in long-term improvements.
“Sustainability and climate resilience are increasingly integral to what water businesses put forward,” Brody said. “From alternative water sources to circular economy initiatives, we expect proposals to be backed by clear evidence and community consultation.”
This approach reflects a growing maturity in how infrastructure planning intersects with environmental responsibility. But Brody is careful to emphasise that innovation must always translate to tangible outcomes for customers.
“We’re not interested in technology for its own sake,” he added. “It has to connect back to what matters for customers.”
Preparing for future challenges
As the ESC finalises its new strategic plan, it focuses on accountability and impact. The plan, launching mid-year, outlines a vision of fair and dependable essential services both today and into the future. It includes core focus areas such as equitable access, efficient pricing, resilience, sustainability, and institutional trust.
“Our vision is for fair and dependable essential services today and tomorrow,” Brody said.
“We’re committed to promoting the long-term interests of Victorian consumers through proactive, inclusive, and transparent regulation.”
For more information, visit esc.vic.gov.au