The AEMC today published a consultation paper on a proposed rule change from Dr Kerry Schott AO, Chair of the Energy Security Board, to streamline the regulatory process for two priority projects identified in the Australian Energy Market Operator’s Integrated System Plan.
The inaugural Integrated System Plan, published in July 2018, forecasts where and when network investment needs to happen to support the large amount of new generation connecting to the grid in the coming years. The plan has a list of priority transmission projects which includes minor upgrades to the interconnectors joining QLD-NSW and VIC-NSW.
The Energy Security Board considers these upgrades should be done before the likely retirement of the Liddell generator in NSW in 2022.
To meet this timeframe, Dr Schott proposes an amendment to the National Electricity Rules to reduce the time between the completion of the cost-benefit assessment (known as the regulatory investment test or RIT-T) for these projects, and when the Australian Energy Regulator makes its determination on whether the transmission businesses can recover the cost of the projects.
The rule change proposal does not remove any steps in the regulatory process, but saves time by allowing the AER to start a post-regulatory investment test step before the previous one has been completed.
As the AEMC considers this to be a non-controversial rule change proposal, we are proceeding under an expedited process, with a final rule due in March 2019.
Subject to any objections to the expedited process, there will only be one round of consultation. Objections to the use of the expedited process must be lodged by 7 February 2019.
Submissions on the consultation paper are due by 21 February 2019.
This rule change request is part of the AEMC’s recommended reforms to the transmission framework set out in our final report for the Coordination of generation and transmission investment review published in December 2018.
Media: Prudence Anderson, Communication Director, 0404 821 935 or (02) 8296 7817