July 2018 Energy Round-Up: Network Investment and National Energy Guarantee Returns

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The CQ monthly round-up is the only comprehensive coverage of regulatory changes for energy businesses across the eastern and south-eastern states and territories.

In today’s round-up we cover changes, announcements and consultations from 6th of July through ‘til the 9th of August. The major themes this month are the National Energy Guarantee (once again) and ongoing policy work on network investment. We consider Commonwealth and Commonwealth agency decisions and announcements first before looking at updates in each of the eastern and south-eastern jurisdictions.

  1. Commonwealth Government and Energy Security Board

On 1 August, the Commonwealth Government and the Energy Security Board published the Final Detailed Design of the National Energy Guarantee.[1] To read more about the detailed design see https://www.compliancequarter.com.au/the-details-of-the-detailed-design-national-energy-guarantee-and-qualifying-contracts/.

  1. Australian Energy Regulator (AER) actions and consultations

The AER made the following announcements over the period:[2]

  • Initiation of a review of the cost thresholds associated with the regulatory investment test (RIT) for transmission and distribution. A draft determination will be published by 11 September 2018;
  • On 30 July, the release of a guidance note aimed at reducing errors by retailers in performance reporting. Compulsory reading for all retailers;
  • Improved cost benefit analysis for RIT;
  • Alinta Energy has paid penalties of $40,000 for allegedly switching customers without consent. An important reminder for all retailers to know the rules with respect to explicit informed consent;
  • On 20 July the release of an annual assessment of Demand Management Innovation Allowance expenditures by electricity distributors for 2016–17;
  • ENGIE paid penalties for an alleged failure to comply with power dispatch order from the energy market operator during a system event on 1 December 2016;
  • Release of draft decision on new rate of return guideline on 10 July, submissions due 14 September 2018;
  • Release of the draft Restricted Asset Exemption Guideline for electricity distribution businesses, along with the accompanying Explanatory Statement. Submissions close 20 August 2018 and can be sent to classificationguideline2018@aer.gov.au.
  1. Australian Energy Market Commission (AEMC)

Announcements over the period included:

  • On 9 August, the release of a draft rule designed to reduce the risk of customers being exposed to the financial shock of inaccurate estimated bills. Submissions due 20 September 2018;
  • On 26 July, the release of three final reports covering the Reliability Frameworks Review, Frequency Control Frameworks Review and Electricity Network Economic Regulatory Framework Review;
  • 26 July 2018, the AEMC provided the Reliability Panel with Terms of reference for the next stage of its review of the frequency operating standard.[3]
  1. Australian Energy Market Operator (AEMO)

The AEMO made some important announcements over the period:

  • Consultation on changes to the Reserve Level Declaration Guideline, submissions due 22 August 2018;
  • Consultation on changes to the MSATS CATS and WIGS Procedures, closing 31 August 2018. These changes affect a range of market participants include Market Retailers and Metering Co-ordinators;
  • On July 23, the AEMO released new Life Support Procedures for the B2B system. This Follows on from last year’s retail rule change putting specific obligations on distributors and retailers around life support notification. Introduces two new B2B transactions, LifeSupportRequest and LifeSupportNotification. The new procedures come into effect 1 Feb 2019. To read more about the rule change go to https://www.compliancequarter.com.au/strengthening-protections-customers-requiring-life-support-equipment/.[4]
  1. Commonwealth Department of the Environment and Energy

The Commonwealth Department of the Environment and Energy announced consultation on amendments to the National Greenhouse and Energy Reporting (Safeguard Mechanism) Rule 2015.[5] Submissions must be received by 7 September 2018.

  1. Australian Renewable Energy Agency (ARENA)

On 9 July ARENA announced the release of new Australian performance standards for home battery storage systems.[6]

  1. Clean Energy Finance Corporation (CEFC)

The CEFC announced the following support for clean energy projects over the period:

  • a $50 million cornerstone investment in Mirvac’s first institutional build-to-rent investment platform in Australia. The CEFC investment will enhance project design across apartments, using clean energy and energy efficiency technologies, with the potential to cut carbon emissions by as much as 40 per cent;
  • An update on CEFC investment commitments in the 12 months to 30 June 2018;
  • Collaboration with Morrison & Co to spearhead clean energy standards across Australian social and economic infrastructure assets, as part of a specialist $1 billion ‘green’ infrastructure fund;
  • a $59 million commitment to the Tasmanian Granville Harbour Wind Farm.[7]
  1. Clean Energy Regulator (CER)

The Clean Energy Regulator released its monthly Emissions Position and Emissions Reduction Fund carbon abatement statement.[8]

  1. Victoria

On 20 July the Essential Services Commission released an updated Compliance and Performance Reporting Guideline – (Version 4), taking into account the new Payment Difficulties Framework that comes into effect from 1 January 2019. They have also released updated reporting templates.[9]

  1. Tasmania

The Tasmanian Department of State Growth announced that it is reviewing its solar feed-in tariffs.[10]

  1. South Australia

On 8 August the Essential Services Commission of South Australia (ESCOSA) released the 2017 Retailer Energy Efficiency Scheme (REES) Annual Report. This audits achievement against the 2017 Ministerial targets for undertaking energy audits and energy efficiency activities in South Australia.

On 10 July ESCOSA released a generator licensing fact sheet.[11]

  1. New South Wales

The Independent Pricing and Regulatory Tribunal (IPART) released a draft report reviewing the financeability test used in its price regulation decisions (note, primarily relates to water decisions). Submissions due 7 September.[12]

  1. Australian Capital Territory (ACT)

On 6 august the ACT Government announced it will use the upcoming Energy Council meeting to seek significant improvements to the National Energy Guarantee (NEG).[13]

  1. Queensland

The Queensland Department of Natural Resources, Mines and Energy invited businesses to join a $10 million energy program to slash power use.[14]

The Queensland Competition Authority (QCA) released a monitoring report reviewing the prices that electricity retailers in south east Queensland charged between 1 April and 30 June 2018.[15]



[1] http://www.coagenergycouncil.gov.au/.

[2] For more information go to https://www.aer.gov.au/news.

[3][3] For more go to https://www.aemc.gov.au/news-centre/media-releases.

[4] See https://www.aemo.com.au/Stakeholder-Consultation/Consultations.

[5] Go to http://www.environment.gov.au/climate-change/government/emissions-reduction-fund/consultation/safeguard-mechanism-legislative-amendments-2018.

[6] To read more go to https://arena.gov.au/news/.

[7] To find out more go to https://www.cefc.com.au.

[8] See http://www.cleanenergyregulator.gov.au/.

[9] For more go to https://www.esc.vic.gov.au/.

[10] See https://www.stategrowth.tas.gov.au/news.

[11] Go to https://www.escosa.sa.gov.au/.

[12] Go to https://www.ipart.nsw.gov.au/Home/Industries/Special-Reviews/Reviews/Financeability-Tests/Review-of-financeability-test-2018.

[13] See https://www.cmtedd.act.gov.au/open_government/inform/act_government_media_releases.

[14] See https://www.dnrme.qld.gov.au/home/.

[15] See http://www.qca.org.au/Media-Centre/Media-Releases/Media-Releases/2018/Jul.


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