Review to change national electricity rules welcomed

The Australian Energy Market Commission’s (AEMC’s) decision to review the National Electricity Rules (NER) making it easier for embedded generators to connect to the electricity grid was welcomed today by ClimateWorks Australia, Seed Advisory and the Property Council of Australia.

The AEMC yesterday initiated the rule change process on a rule change request proposed by the three organisations. The AEMC said the rule change request seeks to make a more timely, clearer and less expensive process for connecting embedded generators to distribution networks. A consultation paper has been published by the AEMC to facilitate the first round of consultation, with submissions due on 9 August.

Increasingly Australian property developers and owners seek to incorporate cogeneration into their existing buildings and new developments.

However, a number of barriers exist that deter embedded generators from connecting to the electricity grid. These barriers make the connection process uncertain, complex, burdensome, time consuming, inefficient and costly.

The joint proposal submitted to the AEMC called for changes to the NER to streamline the grid connection process for embedded generators including:

  • An automatic right of connection to the grid and standard access terms, that applies to generators, which meet ‘Automatic Access Standards
  • Enabling embedded generators a right to export electricity to the grid
  • Providing an improved connection process for embedded generators that are ineligible for automatic access and a right of export
  • Allowing electricity network companies to charge an optional fee‐for‐service to promote collaboration with their customers
  • An obligation on electricity network companies to publish annual network reports identifying where capacity is limited.

The proposal states that these changes can be easily incorporated into Chapter 5 of the NER, which already sets out elements of a streamlined connection process for large generators.

The changes are also similar to aspects of Chapter 5A of the NER which provide a streamlined connection process for micro‐embedded generators such as roof top solar PV.

These changes will replace electricity customers’ case‐by‐case negotiations with a standard process that is clearer, more certain and efficient. It will also encourage greener energy without compromising the integrity of the national electricity grid.

Cogeneration (combined heating and power) and trigeneration (combined cooling, heating and power) are two types of embedded generation. In cogeneration, gas fired units generate electricity and deliver it locally. The heat from electricity production is captured and used to heat and cool buildings.

Cogeneration systems offer a number of benefits including:

  • Greater energy efficiency compared to conventional energy sources
  • Opportunities for private sector innovation in energy production, deliver and consumption
  • The potential to reduce network infrastructure investment
  • The prospect of enhanced security of energy supply.

The Property Council, ClimateWorks and Seed Advisory want to encourage organisations with an interest in cogeneration to provide a submission to the AMEC review of the Connecting Embedded Generators Rule proposal.

Submissions should be sent to submissions@aemc.gov.au (citing Project Ref. ERC0147 in the title) until 9 August 2012.

The AEMC will then review the submissions and make a final determination as to whether to accept the proposed rule change to the NER.

Further information can be found on the AEMC’s website here