Market Review: Completed
On 10 December 2010, the AEMC published an Updated Final Report for the Transmission Reliability Standards Review. The report updates and clarifies a number of detailed recommendations previously made to the Ministerial Council on Energy (MCE) in September 2008, but does not substantively change the Commission's proposal that a national framework for transmission reliability standards should be introduced.
On 3 July 2007, the MCE directed the AEMC, under section 41 of the National Electricity Law (NEL), to conduct a review into electricity transmission network reliability standards, with a view to developing a consistent national framework for network security and reliability. The MCE's direction also required the AEMC to conduct a review into the development of a detailed implementation plan for the national electricity transmission planning function and develop a new form of regulatory test, to amalgamate the reliability and market benefits criteria of the then existing test and expand the definition of market benefits to include national benefits. A copy of the MCE's request can be found below.
On 17 August 2007, the AEMC requested that the Reliability Panel (the Panel), in accordance with section 38 of the NEL, undertake the review of the jurisdictional transmission reliability standards and provide advice to the AEMC. The Terms of Reference required that the Panel provide its final report to the AEMC by 23 September 2008, so that the AEMC could provide a report to the MCE by 30 September 2008.
On 21 December 2007, the Panel published an issues paper on the development of a nationally consistent framework for network security and reliability. The issues paper was the first stage of the consultation process undertaken by the Panel. The issues paper discussed: existing transmission reliability standards (which are established within the National Electricity Rules and jurisdictional instruments); alternative frameworks for nationally consistent standards; links between transmission standards and other parts of the transmission regulatory regime; and implementation issues surrounding the establishment of a new nationally consistent framework for network security and reliability.
Submissions to the issues paper closed on 8 February 2008.
On 24 April 2008, the Panel published its draft report, "Towards a Nationally Consistent Framework for Transmission Reliability Standards". The draft report was second stage in the Panel's work program in the review of transmission reliability standards in the NEM. The draft report responded to submissions to the issues paper, put forward the Panel's draft findings and recommendations, and sought further comments from interested parties. Submissions on the draft report closed on 3 June 2008.
On 30 April 2008, the Panel held a public forum in Melbourne on its Draft Report, "Towards a Nationally Consistent Framework for Transmission Reliability Standards". The public forum provided an important opportunity for interested stakeholders to engage in the consultation process before the publication of the Panel's final report to the AEMC. The presentations made at the public forum and a transcript of proceedings can be found below.
On 29 May 2008, the Panel published a summary report by KEMA entitled ‘International Review of Transmission Reliability Standards', to assist the Panel in developing a framework for nationally consistent transmission reliability standards for the NEM. This summary report outlines the:
- transmission reliability standards used in different electricity markets around the world; and
- frameworks used in foreign electricity markets to ensure consistency of transmission reliability standards across multiple jurisdictions and/or separately owned transmission networks.
KEMA subsequently completed two additional advisory reports for the Panel. All three KEMA reports are now contained in a single volume comprising:
Part 1 - International Review of Transmission Reliability Standards - Summary Report
Part 2 - International Review of Transmission Reliability Standards - Detailed Report
Part 3 - Additional response regarding probabilistic planning methodologies
On 10 July 2008, the Panel outlined a new process and timetable for this review in order to:
- Allow AEMC involvement, at an early stage, to assist it in preparing its report to the MCE;
- Have the Panel publish an Interim Report, to state the Panel's likely preferred position on a framework for nationally consistent transmission reliability standards; and
- Allow stakeholders to comment on the Panel's likely preferred position and allow the Panel to clarify the features and reasoning for any synthesised, preferred, option. To facilitate this, a joint AEMC-Panel stakeholder consultation workshop was to be held two weeks after the publication of the Interim Report.
On 5 August 2008, the Panel published its interim report, "Towards a Nationally Consistent Framework for Transmission Reliability Standards". As part of the Review of Transmission Reliability Standards, this interim report was presented by the Panel to seek stakeholder views on:
- the set of principles that the Panel intended to recommend for developing a nationally consistent framework for transmission reliability standards; and
- the Panel's interim recommendation on a preferred option for a nationally consistent framework for transmission reliability standards, assessed against these principles.
The Panel also released a final report produced by KEMA entitled ‘International Review of Transmission Reliability Standards', which informed the Panel in developing a framework for nationally consistent transmission reliability standards for the NEM. KEMA's report outlines the:
- transmission reliability standards used in different electricity markets around the world;
- frameworks used in foreign electricity markets to ensure consistency of transmission reliability standards across multiple jurisdictions and/or separately owned transmission networks; and
- differences between deterministic, probabilistic, and hybrid standards and planning methodologies.
On 14 August 2008, the AEMC and the Panel jointly convened a stakeholder workshop at which feedback on the Panel's preferred option was canvassed. Interested parties that made submissions to this review were invited to attend.
On 1 September 2008, the Panel provided its Final Report, "Towards a Nationally Consistent Framework for Transmission Reliability Standards" to the AEMC. This report provided the Panel's final recommendations for delivering a nationally consistent framework for transmission reliability standards. In accordance with the Terms of Reference for this review, this Final Report was not published at this time.
On 5 November 2008, the AEMC published its Final Report to the MCE on the Transmission Reliability Standards Review. The Reliability Panel's Final Report to the AEMC on this review was also published. The MCE requested that the AEMC publish these reports. The AEMC submitted these reports to the MCE on 30 September 2008, as specified in the Review's terms of reference.
In the report, the Commission also recommends that the MCE should task the Commission with managing a program to implement the proposed national framework, which the Commission notes is of considerable importance in the context of the COAG national reform agenda. The Commission therefore submitted the Updated Final Report, which reflects a number of significant developments to have occurred since September 2008, in order to best position the MCE to progress this important initiative.