On 23 June 2011, the AEMC published a rule change request received from the Ministerial Council on Energy (MCE) and an AEMC staff consultation paper regarding the request. On the same date, the AEMC also gave notice under section 95 of the National Electricity Law (NEL) that it has commenced the public consultation. Submissions on the Consultation Paper close on 21 July 2011.

Generators who connect to the distribution network (embedded generators) have the potential to reduce the long term need for investment in transmission infrastructure. This is because embedded generators may be able to reduce the distribution network's need to be supplied from the transmission network.

There are currently two payments that embedded generators can receive to reflect this benefit they have to the market. One is a network support payment directly from a Transmission Network Service Provider (TNSP) and the other is an avoided Transmission Use of System (TUoS) payment from the Distribution Network Service Provider (DNSP).

This request seeks to ensure that embedded generators are not over compensated, and therefore consumers overcharged, for the service they provide. That is, to clarify the arrangements for avoided TUoS payments for embedded generators that already receive a network support payment from a TNSP.