Rule Change: Open

Overview

This rule change request from Energy Security Board Chair, Dr Kerry Schott AO, would require large electricity generators to provide at least three years' notice before closing. The request is based on one of the recommendations in the Finkel Panel review.
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This rule change request from Energy Security Board Chair, Dr Kerry Schott AO, would require large electricity generators to provide at least three years' notice before closing. The request is based on one of the recommendations in the Finkel Panel review. 

Draft Determination

On 16 August 2018 the AEMC made a draft rule which would require scheduled and semi-scheduled generators to:

  • give Australian Energy Market Operator (AEMO) at least three years notice of their intention to close a generating unit by notifying a date for terminating the classification of the generating unit and for ceasing generating or trading (if they are a market generator) 
  • notify AEMO of the expected closure year for every scheduled and semi-scheduled generating unit registered 
  • regularly update AEMO of any changes to it as part of the Electricity Statement of Opportunities (ESOO) and projected assessment of system adequacy (PASA) reporting processes
  • require AEMO to publish the "expected closure year" and "closure date" for relevant generating units
  • provide the Reliability Panel the discretion to identify specific energy constraint scenarios to be included for study for the purposes of preparing the Energy Adequacy Assessment Projection (EAAP), which would broaden the nature of input AEMO receives in considering possible energy constraint scenarios.

Submissions on the draft determination and draft rule are due by 27 September 2018.

Background

The rule change request, submitted on 8 March 2018, is based on one of the recommendations of the Independent Review into the Future Security of the National Electricity Market (Finkel Review). The Finkel Review identified managing the retirement of the existing coal-fired generators as they reach their end of life as a key challenge facing the national electricity market.

The Finkel Panel recommended a policy package to achieve an orderly transition to a low emissions future. Part of this policy package was putting in place notice of closure requirements for large generators.

Consultation paper

On 10 May 2018, the AEMC published a consultation paper on the rule change request. Stakeholder submissions closed on 7 June 2018 and can be found below.

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Documentation