Rule Change: Completed

Overview

This package of Rule changes seeks to implement the recommendations arising from the Commission’s Congestion Management Review, which were endorsed by the Ministerial Council on Energy.
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<p>
&nbsp;On 13 August 2009, in response to a Rule change proposed by the Ministerial Council on Energy, the Commission published its Final Rule Determination (Arrangements for Managing Risks Associated with Transmission Network Congestion) and made the following Rules:</p>
<ul>
<li>
National Electricity Amendment (Congestion Information Resource) Rule No 16 2009;</li>
</ul>
<p>
The main benefit of this Rule is that it ensures that market participants have access to a congestion information resource that provides timely and cost-effective information on planned network events and patterns and incidence of mis-pricing in the NEM.</p>
<ul>
<li>
National Electricity Amendment (Negative Inter-regional Settlements Residue Amounts) Rule No 17 2009;</li>
</ul>
<p>
The main benefit of this Rule is that it promotes allocative efficiency in the NEM; and improves the &lsquo;firmness&#39; of the IRSR unit as a hedging instrument while promoting dynamic efficency by increasing competition in the inter-regional contract market.</p>
<ul>
<li>
National Electricity Amendment (Fully Co-optimised and Alternative Constraint Formulations) Rule No 18 2009.</li>
</ul>
<p>
The main benefit of this Rule is that it promotes transparency, predictability and clarity with respect to the formulation and use of constraint equations. It also sets out the process for reviewing AEMO&#39;s treatment of negative settlement residues.</p>
<h2>
Background</h2>
<p>
On 19 February 2009, the Commission received a Rule change proposal from the Ministerial Council on Energy (MCE).</p>
<p>
The Rule change proposal resulted from the MCE&#39;s response to the Commission&#39;s Final Report on the Congestion Management Review (CMR), published in June 2008. A copy of the Final Report and the MCE&#39;s response are available below. In its response, the MCE requested that the Commission make the Rule changes suggested in the Final Report.</p>
<p>
The Final Report included a package of four Rule changes to implement the arrangements for managing risks associated with transmission network congestion. The four proposed Rule changes were:</p>
<ul type="disc">
<li>
National Electricity Amendment (Fully Co-optimised and Alternative Constraint Formulations) Rule;</li>
<li>
National Electricity Amendment (Negative Inter-regional Settlements Residue Amounts) Rule;</li>
<li>
National Electricity Amendment (Congestion Information Resource) Rule; and</li>
<li>
National Electricity Amendment (Network Augmentations) Rule.</li>
</ul>
<p>
On 5 March 2009, the Commission published a notice under sections 95 and 96A of the NEL commencing this Rule change proposal in accordance with the fast track Rule change process on the grounds that the package of four proposed Rule changes were consulted on as part of the CMR.</p>
<p>
On 2 April 2009, the Commission published a notice under section 107 of the NEL to extend the publication date of the draft Rule determination regarding the arrangements for managing risks associated with transmission network congestion by 2 weeks to the 23 April 2009. This extension of time was necessary to consider issues of sufficient complexity that were raised by the Rule change proposal.</p>
<p>
On 23 April 2009, the Commission published a notice under section 99 of the NEL advising of the making of the draft Rule determination. The Commission decided to make the following Rules on the basis that the proposed Rules would meet the National Electricity Objective:</p>
<ul type="disc">
<li>
Draft National Electricity Amendment (Fully Co-optimised and Alternative Constraint Formulations) Rule 2009</li>
<li>
Draft National Electricity Amendment (Negative Inter-regional Settlements Residue Amounts) Rule 2009</li>
<li>
Draft National Electricity Amendment (Congestion Information Resource) Rule 2009</li>
</ul>
<p>
The Commission decided not to make the proposed Network Augmentations Rule. The Commission made this assessment because it found, on the information available to it, that the Network Augmentations Rule would not meet the National Electricity Objective.</p>
<p>
On 5 June 2009,&nbsp; submissions on the draft Rule determination closed.</p>
<p>
On 2 July 2009, the Commission published a notice under section 107A of the National Electricity Law (NEL) to extend the publication date of the final Rule determination and, if appropriate, final Rule(s) by four weeks to 13 August 2009 to allow for additional consultation.</p>
<p>
&nbsp;The Commission required further public submissions and comment on two issues raised by AEMO (formerly NEMMCO) proposing to:&nbsp;</p>
<ul type="disc">
<li>
delete clause 3.13.4(o) of the National Electricity Rules; and</li>
<li>
extend the application of proposed clause 3.6.5(4B) of the Draft National Electricity Amendment (Negative Inter-regional Settlements Residue Amounts) Rule 2009.&nbsp;</li>
</ul>
<p>
An Explanatory Note providing further detail on these specific issues is attached below. The Commission invited interested parties to provide submissions on these issues by 16 July&nbsp; 2009.</p>
<p>
On 13 August 2009, the Commission published&nbsp; notices under sections 102 and 103 of the National Electricity Law (NEL) of the publication of the Final Rule Determination (Arrangements for Managing Risks associated with Transmission Network Congestion) and of the making of the following Rules:</p>
<ul>
<li>
National Electricity Amendment (Congestion Information Resource) Rule No 16 2009;</li>
<li>
National Electricity Amendment (Negative Inter-regional Settlements Residue Amounts) Rule No 17 2009;</li>
<li>
National Electricity Amendment (Fully Co-optimised and Alternative Constraint Formulations) Rule No 18 2009.</li>
</ul>
<p>
The Commission decided not to make the proposed Network Augmentations Rule.</p>

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