The Australian Energy Market Commission is the rule maker and developer for Australian energy markets. As a national, independent body we make and amend the detailed rules for the National Electricity Market (NEM) and elements of natural gas markets. To further support the development of these markets, we also provide strategic and operational advice to the Council of Australian Governments' Ministerial Council on Energy.
The objective of the AEMC’s work is to ensure efficient, reliable and secure energy market frameworks which serve the long-term interests of consumers. Accordingly, all aspects of our work reflect the view that effective competition at wholesale and retail levels, together with balanced regulation for transmission and distribution is the best way to deliver efficient, reliable and safe energy for electricity and gas consumers.
Australia's competitive energy markets have performed well under these arrangements. They have accommodated changing economic and market conditions while maintaining reliable energy supplies. At the same time we know that our nation's energy markets are starting a new phase of rapid change driven by a combination of economic factors and policy initiatives. This is expected to result in changes to the sources of electrical energy (eg expansion of gas-fired and renewable generation in locations, potentially remote from existing infrastructure and consumption and micro generation within current areas of consumption) and a heightened role for, and commitment to, energy efficiency and demand side contributions. The AEMC has a key role in making rules and providing advice to support the delivery of such market development at an efficient cost to consumers.
On establishment in July 2005 we assumed responsibility for rule making and market development in regard to the operation of the electricity wholesale market and transmission regulation in the NEM. In January 2008 our role expanded to include the power to make rules in relation to economic regulation of electricity distribution network services. On 1 July 2008 our role expanded again to include the power to make rules in relation to the economic regulation of gas transmission and distribution services; access to natural gas pipeline services and other elements of broader natural gas markets. On 1 July 2009, we assumed responsibility for the rules in relation to gas retail functions in certain jurisdictions.
On 1 January 2010, Western Australia became a participating jurisdiction in the National Gas Law (to the extent set out in the National Gas Access (WA) Act 2009). This expanded our role to include the power to make rules in relation to elements of the natural gas market in Western Australia such as the economic regulation of natural gas pipeline services.
During 2012 it is expected that we will also assume responsibility for the National Energy Retail Rules under the MCE’s National Energy Customer Framework package of reforms.
The AEMC is a member of ICER, an international body representing over 200 regulatory authorities across six continents. ICER provides a framework for cooperation between energy regulators around the world on global issues affecting energy markets.