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Home Electricity

ESB revises National Electricity Rules

by Staff Writer
May 10, 2019
in Electricity, News, Spotlight
Reading Time: 2 mins read
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The National Electricity Rules have been revised by the Energy Security Board after the stakeholder feedback from the Retailer Reliability Obligation Draft Rules Consultation Paper released 8 March 2019.

These proposed Rules are still subject to agreement by the COAG Energy Council and must then be made by the South Australian Minister before they take effect.

An explanatory paper and proposed National Electricity Rules Amendments has been released and has found the following.

The Retailer Reliability Obligation (the Obligation) builds on existing spot and financial market arrangements in the National Electricity Market (NEM) to facilitate investment in dispatchable capacity and demand response.

It is designed to incentivise retailers, on behalf of their customers, to support the reliability of the power system through their contracting and investment decisions.

The Obligation has three key drivers that will work together to lower electricity prices:

  • Increased contracting unlocking new investment
  • Increased contracting in deeper and more liquid contract markets to reduce the level and volatility of spot prices, and
  • Increased voluntary demand response.

The Obligation is specifically designed so that it does not undermine, and may indeed boost,competition through measures that enhance market liquidity and pricing transparency in retail and wholesale electricity markets.

For example, when the Obligation is triggered, a Market Liquidity Obligation will require the largest participants to offer to buy and sell contracts with all participants in the region.

The full paper provides an overview of the final package of proposed amendments to the NER (final Rules) to implement the Obligation and takes into account stakeholder feedback, and can be found here.

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