Australian electricity and gas markets – May and June update
04 July 2023
On 4 May 2023, the Australian Energy Market Commission (AEMC) released itsfinal ruleandfinal determinationamending theIntegrating Energy Storage Systems into the NEM rule(IESS rule).
The final 'more preferable' rule will reduce the costs and complexity for the Australian Energy Market Operator (AEMO) to implement the IESS rule, and improve certainty for market participants.
The final rule commenced operation on 11 May 2023, however the majority of amendments will take effect on 3 June 2024. For more information, seehere.
On 11 May 2023, the AEMC released aconsultation paperon the AEMC Reliability Panel'sRule Change Requestto amend the Market Price Cap (MPC), Cumulative Price Threshold (CPT) and Administered Price Cap (APC) to the levels recommended in the2022 Reliability Standard and Settings Review.
The Reliability Panel's recommendations stem from the 2022 Review, which found that a significant amount of new investment in generation, demand response and network capacity is required as thermal generators retire. The Rule Change Request aims to support this investment through MPC, CPT and APC market price settings.
For more information, seehere.
No retail rule change requests were initiated in May or June. No AEMC determinations relevant to the National Energy Retail Rules were published.
No gas rule change requests were initiated in May or June. No AEMC determinations relevant to the National Gas Rules were published.
On 11 May 2023, the AEMC released adirections paperon itsmarket review into arrangements for failed retailers' electricity and gas contracts.The paper outlines potential improvement to the current Retailer of Last Resort (RoLR) scheme, which facilitates the orderly transfer of customers to new retailers without disruption to their electricity or gas supply in the event of a retailer failure.
For more information, seehere.
On 18 May 2023, the Australian Energy Regulator (AER) published aconsultation paperon itsCost Benefit Analysis guidelines and Regulatory Investment Test (RIT-T & RIT-D) application guideline review.审查涉及从AEMC的修正案material change in network infrastructure project costs rule determination, and theStage 2 final reportfrom theTransmission Planning and Investment review.
For more information, seehere.
On 23 May 2023, AEMO published adraft 2023 General Power System Risk Review (GPSRR) reportas part of its2023 GPSRR.From 2023, the GPSRR replaces the previous Power System Frequency Risk Review, expanding on its scope to review:
The final GPSRR report is scheduled for publication on31 July 2023.For more information, seehere.
On 25 May 2023, the AEMC published itsfinal reporton itsreview of the Interim Reliability Measure (IRM).The IRM was introduced in 2020 as an interim measure to address reliability concerns. The AEMC has made a final recommendation to continue the IRM to the retailer reliability obligation to30 June 2028.A rule change request will be submitted to give effect to this recommendation. For more information, seehere.
On 25 May 2023, the AER published itsfinal determination for the 2023-24 Default Market Offer (DMO).The DMO is an electricity price safety net that protects consumers from unjustifiably high prices and applies to households and small businesses in South Australia, New South Wales and south-east Queensland.
On 25 May 2023, the Energy Corporation of NSW (EnergyCo) released theNetwork Infrastructure Strategy for NSW.The Network Infrastructure Strategy is a 20-year strategy for the practical coordination of NSW network infrastructure:
The Network Infrastructure Strategy incorporates the NSW Electricity Infrastructure Roadmap, which aims to achieve at least 12 GW of renewable energy generation and 2 GW of long-duration storage by 2030.
The Strategy proposes Network Infrastructure Options with a total capacity of 14 GW to be delivered as soon as practicable over the next decade (by 2033). Further options for up to 24 GW of network infrastructure will be considered to bolster NSW's energy resilience, dependent on modelled scenarios.
On 26 May 2023, AEMO and the Clean Energy Council (CEC) published an updatedConnections Reform Roadmapas part of theConnections Reform Initiative(CRI). The updated Roadmap details how the CRI will move through the planning to implementation phase. For our latest update on the Connections Reform Initiative, see our articlePowering progress: Clean Energy Council's rule change sparks investor certainty in connection process.
On 20 June 2023, the AER released its2023-2024 Compliance and Enforcement Priorities.The Compliance and Enforcement Priorities help guide the AER's enforcement work and proactive compliance efforts, and are designed to signal areas where the AER considers that behavioural change in the market is required. The 2023-2024 priorities are:
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Authors:Andre Dauwalder, Counsel; Alexandria Brown, Graduate and James Heading, Seasonal Clerk.