The technology revolution underway in the energy sector has been accelerating in recent years. Effective and active leadership by the COAG Energy Council in setting a strategic direction for the sector is critical to deliver secure, reliable power at the best price for consumers.
In this context, the COAG Energy Council's governance review recommended in 2015 that the AEMC prepare a major policy paper every three years containing advice on market development strategy to inform the Council’s priorities for the energy sector.
Following that recommendation, the COAG Energy Council formally asked the AEMC to provide this expert advice. The Commission received these terms of reference in December 2016.
Stakeholder views will underpin the AEMC’s advice to the Council.
We will undertake a detailed program of consultation, starting with an approach paper to be published in April 2017 which will set out the context, scope and approach to preparing our advice.
The AEMC initiated the first strategic priorities review in 2011. The priorities, published every two years, were developed in close consultation with community, business and government stakeholders. Our reviews identified:
- challenges posed by the changing generation mix for power system security and the financial resilience of energy markets
- the importance of integrating energy and emissions policy
- the need for predictable policy to underpin future investment in generation capacity
- ways to enable energy consumers to make informed choices, focusing on protection, participation and engagement, so consumers can benefit from innovations and enhanced competition in energy markets
- the need for gas market reform so Australia has well-functioning gas markets as the LNG export industry ramps up.
The COAG Energy Council has now built on that earlier work by asking the Commission and its stakeholders to directly inform the energy ministers' own priorities and work program. This new process will replace the AEMC’s previous biennial strategic priority reviews.
Working together with stakeholders, we will produce market development priorities to be addressed by policy makers and the market institutions over the next few years. We will consult broadly and draw upon a wide range of stakeholder perspectives to share with the Council in our advice.
In line with the Terms of Reference, the AEMC will deliver its advice to the COAG Energy Council in October every three years, starting this year. The Council will then publish its strategic priorities in December.