The AEMC is seeking submissions on a draft rule that would require large electricity generators to provide at least three years’ notice before closing. The request is based on one of the recommendations in the Finkel Panel review.

The draft rule would enhance the information available to AEMO and the market on generator closures. This information would help market participants respond to possible future shortfalls in electricity generation, for example by building replacement capacity.

Specifically, the draft rule would make generators with scheduled or semi-scheduled generating units give AEMO at least three years’ notice of an intention to close, and regularly update AEMO about any changes.

This information would be included in AEMO’s medium and long-term forecasts - the MT PASA and  Electricity Statement of Opportunities reports, respectively.

The AEMC also recommends new civil penalties, enforced by the Australian Energy Regulator, if generators fail to comply with the new obligations.

The Finkel Review recommended a policy package to achieve an orderly transition to a low emissions future. The package included putting in place notice of closure requirements for large generators to help manage the retirement of existing coal-fired generators as they reach the end of their economic lives. This would provide time for replacement capacity to be built and for affected communities to plan for change.

This rule change request is being progressed as part of the Commission’s broader system security and reliability work program.

The AEMC invites stakeholders to make submissions on the draft determination and draft rule by 27 September 2018.

Media: Prudence Anderson, Communications Director, 0404 821 935