Consultation paper
On 14 March 2024, the Australian Energy Market Commission (AEMC) released a consultation paper on the Providing flexibility in the allocation of interconnector costs rule change request submitted by the Honourable Chris Bowen MP, Minister for Climate Change and Energy, the Honourable Lily D’Ambrosio MP, Minister for Energy and Resources and the Honourable Nick Duigan MLC, Minister for Energy and Renewables. The consultation paper examines the proposal to give effect to jurisdictional inter-governmental agreements on interconnector cost allocation in the NER.
Under the proposed rule change, jurisdictions could submit inter-governmental agreements on cost allocation to the Australian Energy Regulator. These agreements, subject to defined criteria, would outline agreed allocation of project and ongoing interconnector costs.
The rule change request does not seek to change the existing National Electricity Rules (NER) cost allocation framework, which would continue to apply where an inter-governmental agreement is not in place.
The AER made a submission to the consultation paper on 16 April 2024.
Draft determination
On 17 June 2024, the AEMC released a draft determination and more preferable draft rule on the rule change request.
Specifically the draft rule would:
- provide flexibility for two or more Ministers to make an agreement
- require an agreement to satisfy a minimum set of implementation criteria
- set out the roles and processes relating to agreements, providing clarity for government, market bodies and Transmission Network Service Providers (TNSPs), and
- require the AER to publish agreements, providing transparency.
The AER made a submission to the draft determination on 1 August 2024.