The Australian Energy Market Commission is calling for submissions on proposed reforms to the way generators access and use the electricity transmission network. We are also seeking feedback on proposed changes to the charging arrangements which enable transmission businesses to recover the costs of building and maintaining transmission infrastructure, both within and between regions.

A huge amount of generation will be built in the national electricity market in the coming years, taking the place of ageing coal-fired power. With more generators seeking to connect, the transmission network is expected to become increasingly congested. 

To help deliver the right amount of new transmission infrastructure to meet future network needs, while keeping costs to consumers as low as possible, today’s consultation paper sets out recommended changes to the framework for transmission network access and charging.

Stakeholders are invited to comment on:

  • phased reforms to access arrangements, starting with dynamic regional pricing to reflect where network congestion is happening in real time, and moving to a system where generators are able to buy firm rights to use the transmission network or be compensated if they are constrained off
  • reforms to transmission charging arrangements, including those relating to inter-regional transmission. This includes looking at whether the cost of a particular interconnector is adequately attributed to the region which benefits from that interconnector.

Submissions on the consultation paper are due by 29 March 2019. 

There will be further opportunities for stakeholder input on access and charging arrangements throughout the year, including public workshops. We aim to deliver the COAG Energy Council a final package of proposed regulatory changes in December 2019.

Media: Prudence Anderson, Communication Director, 0404 821 935 or DL (02) 8296 7817.

BACKGROUND

This work is part of the AEMC’s broader package of changes to the regulatory framework to support new investment in transmission networks in line with AEMO’s Integrated System Plan. Other key reforms in the package are:

  • streamlining the regulatory process for priority transmission projects – this is being progressed through rule change requests to the AEMC from the Energy Security Board
  • supporting the seamless integration of large-scale energy storage systems – this will be progressed through a rule change request from AEMO
  • embedding the Integrated System Plan in the regulatory framework through changes to the National Electricity Rules and National Electricity Law – this will be progressed by the Energy Security Board.

About the Integrated System Plan

AEMO’s Integrated System Plan, published in July 2018, sets out where and when network investment needs to happen to support the large amount of new generation connecting to the grid in the coming years. 

The COAG Energy Council asked the Energy Security Board to work with the market bodies - the AEMC, AEMO and Australian Energy Regulator - to make the Integrated System Plan “actionable”. 

The AEMC has developed a comprehensive reform package as part of that process. Our report on improving the coordination of investment in electricity generation and transmission, published in December 2018, sets out the nuts and bolts of how to deliver the Integrated System Plan. The report was developed in consultation with stakeholders and underpins the Energy Security Board’s vision for making the Integrated System Plan actionable.  

See also:

Related Articles