Rule Change: Open
On 4 September 2020, the AEMC received a rule change request from the Hon Lily D’Ambrosio MP – Minister for Energy, Environment and Climate Change, Minister for Solar Homes, which seeks to make procedural changes to the operation of the prudent discounts framework in Victoria, which is an adoptive jurisdiction.
On 8 October 2020, the AEMC initiated the rule change request under an expedited rule change process with the publication of a consultation paper which seeks to facilitate stakeholder feedback on the proposed changes.
Rule change request
The rule change request seeks to make procedural changes to the operation of the prudent discount framework in adoptive jurisdictions in the National Electricity Rules (NER or Rules).
An adoptive jurisdiction is one where the declared network functions of the Australian Energy Market Operator (AEMO) apply. At this time, Victoria is the only such adoptive jurisdiction.
The intent of the proposed changes is to clarify the procedural roles and responsibilities of both AEMO as the Victorian transmission network service provider (TNSP) and declared transmission service operators (DTSOs), which own the assets forming the transmission network in Victoria. The proponent also seeks to clarify and improve the procedural rights of Victorian transmission customers who wish to request a prudent discount.
The rule change request identifies three key issues related to the current prudent discount framework in Victoria:
- The Rules do not provide an obligation on the relevant DTSO to negotiate in good faith directly with a transmission customer who requests a discount, reducing the procedural rights of a transmission customer to obtain relevant information compared to in other jurisdictions.
- The Rules do not provide an obligation on AEMO as the TNSP to provide reasons for refusing to agree to a discount or an obligation on the DTSO to provide reasons for refusing to consent to AEMO providing a discount.
- There is a lack of clarity as to whether AEMO can propose to agree to a discount on a conditional basis, pending the outcome of an application to the Australian Energy Regulator (AER) for approval of recovery of the entire discount amount from other transmission customers.
Expedited (non-controversial) rule change
The Minister has requested that the rule change request be treated as non-controversial and therefore processed on an expedited basis.
The Commission considers that the proposed rule meets the definition of a non-controversial, in that it is unlikely to have a significant effect on the national electricity market. The rule change request is narrow in scope, and the proposed changes are largely of an administrative nature. The Commission has therefore decided to use an expedited process to consider this rule change request, provided it does not receive any valid requests not to.
The key dates for stakeholders in this process are as follows:
- Initiation of rule change process and publication of this consultation paper: 8 October 2020
- Written requests not to use the expedited process to be received by: 22 October 2020
- Submissions to the consultation paper to be received by: 5 November 2020
- Publication of the final rule determination and final rule (if made): 3 December 2020