Market Review: Open

Overview

The AEMC is developing advice for governments on detailed regulatory changes to enable distribution network businesses to supply their customers with stand-alone power systems (SAPS) where it is cheaper than maintaining a connection to the grid.
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The AEMC is developing advice for governments on detailed regulatory changes to enable distribution network businesses to supply their customers with stand-alone power systems (SAPS) where it is cheaper than maintaining a connection to the grid. 

SAPS – usually a combination of solar PV, batteries and a back-up generator -  are increasingly allowing electricity services to be delivered through alternatives to grid connection at a lower cost and with improved reliability, which could be particularly beneficial for remote communities. Currently, SAPS are not captured under national regulatory frameworks or are subject to jurisdictional frameworks which vary in their coverage. 

To address these issues, the AEMC recommended new regulatory arrangements, as outlined in the final report for our Review of regulatory frameworks for stand-alone power systems - priority 1.

Implementing these recommendations will require a package of rule changes, which is the focus of this current review. The changes will:

  • support efficient planning and investment outcomes in relation to SAPS
  • extend existing market arrangements to accommodate distributor-led SAPS, including the full-suite of energy-specific consumer protections
  • allow participation by jurisdictions in the national arrangements for distributor-led SAPS on an opt-in basis.

The Commission is concurrently undertaking a review of the regulatory framework for SAPS delivered by parties other than the local network service provider, which considers the regulatory and commercial arrangements that would apply on an ongoing basis, along with the consumer protections that should be put in place, for customers moving off-grid to receive supply from third-party SAPS.  

In parallel, the COAG Energy Council’s Senior Committee of Officials has established a working group to progress recommendations from the Review of the regulatory framework for stand-alone power systems –priority 1 and Updating the regulatory framework for embedded networks.The AEMC will liaise closely with the working group to progress this work.

Next steps

The Commission plans to publish:

  • a draft report in December 2019
  • a final report by May 2020.

The Commission may also publish additional consultation papers if needed.

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Documentation