Consultation paper
The Australian Energy Market Commission (AEMC) published a consultation paper on 3 October 2024 on a rule change request from the Honourable Lily D’Ambrosio MP, Victorian Minister for Energy and Resources, to include distribution network resilience in the National Electricity Rules (NER).
The rule change request also proposes that the AER develop and publish a network resilience guideline. We understand the proposal is to replace the existing AER guidance note with new AER guidelines, which would be binding on DNSPs. While we appreciate the need for certainty, we consider that a prescriptive binding guideline may not be appropriate in a new and still evolving area like network resilience.
The uncertainty associated with the treatment of network resilience under the NER was a key reason for the AER’s 2022 release of its initial guidance note on network resilience. Despite the AER approving a significant amount of resilience-related expenditure proposed in determinations, we considered there may be value in including network resilience as an explicit factor to consider when assessing expenditure proposals.
The AER made a submission on the consultation paper on 7 November 2024.
Supplementary submission in response to the consultation paper
This submission is further feedback on the AEMC’s consultation paper and should be considered as a supplement to the AER’s submission of 7 November 2024 to the consultation paper.
This supplementary submission is to raise our concerns about the broader scope of the rule change request to cover risks from. ‘other catastrophic events’, such as cyber-security events and terrorist attacks on critical infrastructure. We do not consider there is currently a need to amend the National Electricity Rules beyond the scope of weather-related events. The rule change request does not provide compelling evidence on the policy problem to be addressed, or appear to consider the existing provisions and arrangements to deal with “other catastrophic events”. The broader scope of network resilience would limit the efficacy of the proposed AER guidelines for network resilience.