The AER has commenced a review of transmission ring-fencing arrangements and is seeking stakeholder input to update to the current transmission ring-fencing guideline.
A positive investment and competitive environment supported by effective regulation will deliver affordable and reliable energy for Australian consumers. The AER’s transmission ring-fencing guideline enables the participation of transmission businesses in contestable electricity markets while at the same time supporting the long-term interests of consumers. For example, transmission businesses provide connection services to electricity generators and some large customers, and some of their affiliates own or have interests in electricity generation assets.
The current transmission ring-fencing guideline was first developed in 2002 and has not been substantially reviewed since then.
The discussion paper released todays seeks stakeholder views in regard to any harm that could arise from an electricity transmission business, or one of its affiliates, operating is contestable electricity markets. The discussion paper also considers changes in markets for contestable electricity services since the initial development of the guideline, and the AER’s recently developed national approach to ring-fencing of distribution networks.
Submissions to the discussion paper are due by 31 January 2020.
Enquiries can be directed to ringfencing
aer [dot] gov [dot] au (ringfencing[at]aer[dot]gov[dot]au).
Background
Ring-fencing supports competition in markets for electricity services and efficiency of regulated network services provided to consumers on a monopoly basis. It does this by requiring a network service provider to separate parts of its business that provide regulated services from the parts of its business that provide unregulated services.