The AER has made a draft decision to grant exemptions to Jemena Pipeline Businesses from ring-fencing obligations under section 140 of the National Gas Law in relation to Jemena Northern Gas Pipeline Pty Ltd's (JNGP) operation of the Phillip Creek Compressor Station (PCCS).
The AER considers that, in current circumstances, the cost savings resulting from the exemptions outweigh any potential benefits of complying with the ring-fencing obligations.
Jemena is required under the National Gas Rules to notify the AER, without delay, if it no longer qualifies for the exemptions.
Our exemptions also include conditions that provide the AER an opportunity to review the exemptions in circumstances that may affect their validity.
Background
Gas ring-fencing laws were extended under the March 2023 gas reforms to include non-scheme pipelines. Service providers of these pipelines are required to comply with the new laws from 2 March 2024.
The ring-fencing framework set out in Part 2 of Chapter 4 of the National Gas Law provides for the specific obligations applicable to gas pipeline service providers. The provisions ensure that related businesses do not gain a competitive advantage by virtue of their common ownership or operation with pipelines.
Service providers may apply to the AER for an exemption from the ring-fencing provisions under rule 34 of the National Gas Rules.
Learn more about ring-fencing
The AER has published a Compliance bulletin – new obligations on gas pipeline, compression and storage service providers and a Gas ring-fencing decision guide