The Australian Energy Regulator (AER) has granted a class waiver under the Electricity Distribution Ring-fencing Guideline (the Guideline) to distribution network service providers (DNSPs).
The class waiver applies only to the provision of network services for the planned Central-West Orana Renewable Energy Zone (REZ) and relates to the circumstance where Energy Corporation NSW selects a DNSP as a Network Operator for that REZ. Our decision is to waive legal and functional separation obligations under the Guideline.
In granting this waiver we aim to provide regulatory certainty so that DNSPs may participate in the competitive procurement process currently being undertaken by the NSW Infrastructure Planner (Energy Corporation of NSW) to select a proponent to build the first REZ network project. Based on our understanding of the regulatory framework for REZs being developed, DNSPs may be prohibited from providing REZ network services under the Guideline.
The decision outlines our reasons for granting the waiver.
Background
The AER exists to ensure energy consumers are better off, now and in the future. We are the economic regulator for electricity and gas networks in every state and territory in Australia except Western Australia. On 12 November 2021 we were appointed as a Regulator under the NSW Electricity Infrastructure Investment Act 2020. As a regulator we are responsible for a range of functions, including undertaking a Transmission Efficiency Test and making revenue determinations for network infrastructure projects, once a network operator is selected by the Infrastructure Planner and authorised by the AEMO Services Ltd as the independent Consumer Trustee.