The Australian Energy Market Commission (AEMC) today released a consultation paper to review what changes to gas and energy retail rules are needed to include hydrogen and renewable gases in the domestic gas market to support the decarbonisation of Australia’s energy sector. 

This is an important first step in setting up the national regulatory framework so low-level hydrogen blended gases and renewable gases can be safely supplied to existing gas distribution systems and gas appliances in homes and businesses. 

‘Reforms in the regulatory framework will lay the foundations for the development of a decarbonised gas sector in Australia,’ AEMC Chair Anna Collyer said. 

‘These reforms are considered a priority under the Australian Government’s National Hydrogen Strategy and we need to make sure they’re delivered in an efficient, safe and secure way that’s also in the best interests of consumers.’

The AEMC’s review will explore all sections of the national gas rules as well as parts of the national energy retail rules to determine what changes are needed to accommodate hydrogen and renewable gases. Aspects of the rules that will be considered include: 

  • access to gas pipelines 
  • safe supply of low-level blended gases 
  • consumer protections including billing and pricing.

Natural gas ‘equivalents’ have different physical properties to natural gas, which is currently supplied to homes and businesses. Variations in the energy density or heating value may mean more or less volume of the natural gas equivalent has to be supplied to a customer’s home to deliver the same heating value as natural gas. 

‘We also believe clarifying how the rules should apply to low-level hydrogen blends and renewable gases will give the investment certainty needed to support the growth of this new sector,’ said Ms Collyer. 

‘There are a number of trials of natural gas equivalents underway or expected to commence within the next couple of years. The Energy Ministers recognised that giving investment certainty was important to help remove potential barriers to these trials.’

The Energy Ministers asked the AEMC to undertake the national review, which is part of a wider work program to transition the energy sector for a renewable future. The AEMC is concurrently running a related rule change process to assess the Declared Wholesale Gas Market (DWGM) distribution connected facilities, a request submitted by the Victorian Energy Minister. 

Both these projects support the decarbonisation of the energy sector with blended gases and other initiatives. 

Submissions to the hydrogen and renewable gas review consultation paper and the Victorian DWGM rule change consultation paper are open until 2 December 2021.

Jurisdictional officials and the Australian Energy Market Operator are undertaking related and concurrent work looking at the gas and energy retail laws and procedures. 

Visit the hydrogen review the project page for more information and contact details.