Version 4 of Guideline Released

On 27 February 2025, the AER released version 4 of the Electricity distribution ring-fencing guideline (the Guideline), accompanied by an explanatory statement. 

The updated guideline focuses on giving the AER additional discretion to tailor waivers from ring-fencing obligations taking into account all relevant circumstances. It also makes a small change to the way distribution network businesses submit their annual ring-fencing compliance reports. 

The amendments seek to ensure the guidelines remain fit for purpose in a changing regulatory landscape and electricity market by:

• Removing the maximum length of waivers and providing the AER with discretion to determine the duration of waivers (extending the approach already used for waivers related to energy storage and stand-alone power systems).
• Requiring distribution network businesses to have annual ring-fencing compliance reports accompanied by a letter signed by a director or most senior executive, in-line with best practice. 

Version 4 of the guideline applies to distribution network businesses from 27 February 2025.