AUSTRALIA Law and Practice Contributed by: Alexander Danne, Roy Groom, Rohit Venkat and Georgia Summerhill, Clayton Utz
Terms of service are governed by connection agree- ments negotiated under NER Chapter 5. The NER prescribe minimum service standards and access arrangements. In Western Australia, transmission charges are regulated by the Economic Regulation Authority under the Electricity Networks Access Code 2004, applying broadly analogous cost-reflective pric- ing principles. Appeals against AER revenue determinations were previously available through a limited merits review to the Australian Competition Tribunal. This pathway has been substantially curtailed, with judicial review to the Federal Court now the primary avenue for challenge. 4.7 Open-Access and Non-Discriminatory Transmission Open-Access Obligation Transmission service in the NEM is provided on an open-access and non-discriminatory basis. Under NER Chapter 5, TNSPs are required to offer connec- tion to all generators and load customers who satisfy the applicable technical standards. The NER prohibit TNSPs from: • refusing access on the basis of the identity or com- mercial interests of the applicant; • favouring affiliated entities over other connection applicants; and • discriminating between applicants seeking equiva- lent services. Regulation and oversight Open access is regulated by the AER, which monitors compliance with connection obligations, ring-fencing requirements and network performance standards. The AEMO oversees the registration of new con- nections and coordinates technical assessments to ensure that system security is maintained. No firm transmission rights Users of transmission services in the NEM do not acquire firm or exclusive rights to transmission capac- ity. Unlike some international markets (notably parts of the US), the NEM does not operate a system of firm or financial transmission rights. Instead, access to the network is shared, with congestion managed through constraint equations applied by the AEMO
in the dispatch process. Where network congestion limits the output of a generator, the affected partici- pant bears the risk of being constrained off. This fea- ture has prompted ongoing policy debate about the introduction of congestion management mechanisms. Connection reform The AEMC has progressed rule reforms to improve connection transparency, including: • standardised connection processes and documen- tation; • clearer timelines for NSP responses at each stage; and • enhanced information disclosure by TNSPs regard- ing available network capacity. These reforms respond to significant delays and infor- mation asymmetry experienced by connection appli- cants, particularly renewable energy developers seek- ing access in congested Renewable Energy Zones. Western Australia Open access to the SWIS is governed by the Elec- tricity Networks Access Code 2004, which similarly requires Western Power to provide non-discriminatory access to covered network services. 5. Distribution 5.1 Constructing and Operating Electricity Distribution Facilities The construction and operation of electricity distri- bution facilities (including storage and microgrids) is governed by a legislative framework substantially par- allel to that applying to transmission, with regulation occurring under both national energy laws and state- based planning and licensing regimes. Under the National Electricity Law and NER (princi- pally Chapter 6), distribution network service provid- ers (DNSPs) must be registered with the AEMO and comply with technical standards, service-quality obli- gations and economic regulation by the AER. State electricity legislation provides the licensing framework for distribution operators. In NSW, distribution licenc- es are issued under the Electricity Supply Act 1995;
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