The Australian Energy Market Commission (AEMC) has welcomed the next steps in the implementation of reforms we recommended to support the efficient provision of stand-alone power systems (SAPS).

SAPS are usually a combination of solar, batteries and a back-up generator and can be an alternative to using the national grid to serve customers in remote areas. SAPS include microgrids and individual power systems and have become more viable as technology improves and costs drop.

The Statutes Amendment (National Energy Laws) (Stand-Alone Power Systems) Act was passed this month and came after the AEMC's 2019 and 2020 reports recommending changes to energy laws and rules to enable distributor-led SAPS when this is cheaper than maintaining a grid connection.

We welcome consultation on amendments to the package of rules developed by the AEMC and note that a final rule change package is expected to go to Energy Ministers for approval in mid-2021.

Senior officials are consulting on changes needed to ensure consistency between law changes for SAPS made under the Act and changes to the retail and electricity rules required to give the framework effect. Certain drafting changes to the SAPS rules are also required to accommodate changes to the NER made by the introduction of a mechanism for wholesale demand response (WDR Rule). The WDR Rule will come into effect before the proposed rule amendments for distributor-led SAPS.

In 2019, the AEMC set out high-level recommendations for reforms to facilitate the provision of SAPS by distribution businesses where this is a better option than building more poles and wires, while ensuring consumers were protected.

Last year, the AEMC released a final report proposing changes to the national electricity and energy retail rules to implement the new approach for SAPS recommended in the 2019 report.

Further details on the rules consultation can be found here.