The AEMC has published a draft report with a package of proposed rules to enable distribution network businesses to supply their customers using stand-alone power systems, where it is cheaper than maintaining a connection to the grid. The proposed rules give effect to the recommendations made in the AEMC’s priority 1 final report for our Review of regulatory frameworks for stand-alone power systems.

Under the new rules, a stand-alone power system (SAPS) - usually a combination of solar PV, batteries and a back-up generator - could be installed by a distribution business but would not be physically connected to the national grid. Consumers supplied by distributor-led SAPS will have the same protections, reliability standards and access to competitive retail offers as those connected to the grid.

The changes will help unlock the benefits of new technologies that allow electricity to be delivered through alternatives to traditional grid connection, at a lower cost. Customers using SAPS supply may also experience improved reliability and reduced bushfire risks.

The COAG Energy Council’s Senior Committee of Officials asked the AEMC to develop and consult on these proposed rule changes so distributor-led SAPS can happen as soon as possible. The Committee has also established a working group to progress accompanying legislative changes.

In parallel with today’s report, the Australian Energy Regulator has published an explanatory note which provides guidance on when a ring-fencing waiver to allow a distributor to provide SAPS generation services may be needed, and how such applications might be assessed. Under the AEMC’s proposed rules, SAPS generation would not be a distribution service. As such, these services would be subject to ring-fencing and could not be offered by distribution network businesses unless the AER agreed to a waiver.

A stakeholder workshop for the distributor-led SAPS rule change package will be held on 29 January 2020 in Brisbane to discuss the draft report and AER explanatory note. Registration for the workshop will be open in the new year. For any queries please contact Meghan Dalton on (02) 8296 7800 or meghan.dalton@aemc.gov.au.

Submissions are due by 13 February 2020.

Media: Kellie Bisset, Media & Content Manager, 0438 490 041 or (02) 8296 7813