The last several months have meant a lot of changes, big and small. For me, these have ranged from discovering the secret skills of staff that have emerged from lockdown – juggling, cooking goulash, semi-professional breakdancing and bending the rules on board games – to rolling out changes to the Australian Energy Market Commission’s work program to adjust to the COVID-19 pandemic. We have embraced virtual stakeholder engagement and reprioritised the work program to keep the momentum going on key reforms.
We’re now moving into the next phase of prioritising our work for the year ahead.
The AEMC has just had one of its busiest years on record for rule changes and rule requests. Over the last two years, we have had three times the regular number of rule requests. We are now at version 149 of the electricity rules, version 55 of the gas rules and version 24 of the retail rules. And the pace of change will only intensify as the world around us changes.
The energy market itself is at a turning point. Volatility and uncertainty in the electricity market, the technology revolution, ageing assets and changing consumer needs mean that we at the AEMC need to drill down into what reforms are needed to support a reliable, lower cost and lower emissions system.
In a COVID-constrained economy, everyone’s resources are under pressure.
So it’s never been more important to make sure we get the right resources to the right projects.
Through our membership of Energy Security Board, we are very focussed on the post 2025 design of the national electricity market that will be go to federal and state energy ministers by mid-2021. This redesign is the best way to map out a long-term path to an electricity market that can make people’s lives better.
You will have seen the final stages of the post 2025 project: last week’s consultation paper updating what the market bodies are doing to redesign the market. There is a huge work program.
AEMC staff are heavily involved in several work packages for the post 2025 redesign. All relate to pressing issues. These include on security and on integrating distributed energy resources such as rooftop solar panels and batteries in electric vehicles that export power back to the grid.
To guarantee the success of this crucial work and deploy our resources most effectively, we are proposing measures to prioritise our workload.
When deciding which rule changes to prioritise, we are proposing to develop criteria relating to ESB and AEMC work. For example, a rule change could be an opportunity to fast track thinking that has been developed through ESB work into a rule change or it may be in line with our five strategic priorities which are outlined on our website and seek to address high priority market issues like system security, integration of distributed energy and digitalisation
We are also looking at applying the criteria and communicating how this is applied when making decisions about initiating pending rule changes.
In order to free up resources for this urgent priority work, over the next financial year, we are proposing to not conduct the review of retail competition, or the 2021 electricity network economic regulatory framework. These regular reviews are important and the pause in undertaking them simply reflects the need to get on with the reform agenda at hand. It recognises what stakeholders have been telling us – they are struggling to keep up with everything that is already underway. However, that doesn’t mean the AEMC won’t be thinking about the long term when it comes to issues impacting the retail and network sectors. We will do this in other ways over this financial year to position ourselves for the next wave of changes to keep the lights on, prices down and emissions low.
We would like your feedback on this so please reach out to me.