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2023 - The Year That Was

2023 - The Year That Was

In recent years the pace and breadth of change and developments in the energy sector has been remarkable. Looking back over the past 12 months it is apparent that continues to be the case.

BY Australian Energy Council Dec 19 2023
New Year, new regulated pricing approaches?

New Year, new regulated pricing approaches?

Consultations are underway for the setting of the default market offers in 2024. Both the Australian Energy Regulator (AER) and the Essential Services Commission (ESC) in Victoria and have released early papers outlining their key areas of focus. In comparing the two approaches, the AER appears to be undergoing a more detailed review, whereas the ESC seems to be more settled in its methodology overall. We take a look at the approaches being undertaken.

BY Jo De Silva Dec 07 2023
Delivering the energy transition: Contestability vs financeability

Delivering the energy transition: Contestability vs financeability

The development and construction of new transmission where economically justified is critical for the energy transition and it needs to be delivered in a timely and efficient manner. Several rule change proposals highlighting concerns about the TNSPs’ ability to raise the necessary finance to fund construction on terms that maintain a BBB+ credit rating. We take a look at the issue and consider whether there might be other workable approaches to deliver the transmission the transition requires.

BY Peter Brook Dec 07 2023
Expanded National CIS: What are the pros and cons?

Expanded National CIS: What are the pros and cons?

The expanded Capacity Investment Scheme (CIS) announced last week aims to bring forward 32GW of generation investment - 9GW dispatchable capacity and 23GW variable renewable capacity - with the costs of the scheme funded by the Federal Government. It can be expected to encourage new capacity which will represent a significant injection of renewables into a grid with ongoing system constraints so does not come without some risks. We take a look at some of the pros and cons.

BY David Feeney Nov 30 2023
Rushing to the finish line: Can we clear the hurdles on the way to 100% smart meters by 2030?

Rushing to the finish line: Can we clear the hurdles on the way to 100% smart meters by 2030?

Last month, a report by the Australian Energy Market Commission (AEMC) recommended that the deployment of smart meters across the National Electricity Market (excluding Victoria) should be accelerated so we achieve 100 per cent uptake among small customers by 2030. The AEMC argues that achieving a critical mass of smart meter deployment in a far timelier manner will deliver greater benefits for customers and support the wider decarbonisation of the energy market. But what are the hurdles that will need to be cleared on the way to the finish line? We take a look.

BY Braeden Keen Sep 21 2023
Supporting customers with high energy costs: A retailer perspective

Supporting customers with high energy costs: A retailer perspective

We take a look inside energy retail businesses to see what support is offered to customers facing hardship. While retailers have a range of relevant regulatory obligations, their programs go over and above their obligations to help customers in payment difficulty or at risk of payment difficulty. Retailers take their role as providers of essential services very seriously and the intensive monitoring and reporting of their obligations illustrates this.

BY Jo De Silva Sep 14 2023
NSW’s electricity Check Up confirms challenges of transition

NSW’s electricity Check Up confirms challenges of transition

NSW’s Electricity Supply and Reliability Check Up report released last week confirms the massive challenge represented by the energy transition and the need for flexibility to get it right. It has effectively provided the NSW Government with a risk management strategy. Overall, the report contains a broad range of recommendations that form a generally pragmatic response to the hurdles that have emerged through the energy market transition to date.

BY Sarah McNamara Sep 14 2023
The Wholesale Demand Response Mechanism: Leading a horse to water

The Wholesale Demand Response Mechanism: Leading a horse to water

After being first recommended in 2011 by the AEMC's Power of Choice Review, and followed by a decade-long passionate debate, the Wholesale Demand Response Mechanism was finally implemented on 24 October 2021. Two years later we look back and see if it was worth all the effort.

BY Ben Skinner Sep 07 2023
Market assessment highlights evolving market

Market assessment highlights evolving market

In late July, the Australian Energy Market Operator published their analysis of the wholesale market for the second quarter of this year. While the media headlines trumpeted price rises of 31 per cent, the report itself paints a much more restrained picture of the state of the market. As the AEC pointed out at the time, the report illustrates a stabilisation when compared with this time last year, with the industry in a much better position heading into winter than it was in 2022.

BY Australian Energy Council Aug 10 2023
Reports highlight ongoing challenge of transition

Reports highlight ongoing challenge of transition

Amidst all the discussion of the energy transition two new reports looking at energy use and options for the energy transition have highlighted the continued major challenge to reduce overall carbon emissions. We take a look at the '2023 statistical review of world energy' and the ‘How to make net zero happen’ reports side by side to provide a picture of where energy consumption has been, and where it may be going in the future and the implications for the energy sector.

BY Australian Energy Council Jul 20 2023
Rebirthing coal power stations into synchronous condensers

Rebirthing coal power stations into synchronous condensers

As the power system transitions, the Essential System Services previously supplied by fossil fuelled generators must be replaced. This requires a widespread rollout of Synchronous Condensers (SCs). ARENA has supported and published a report into an unconventional but promising solution, the conversion of fossil fuelled generators into SCs, either whilst the generator is still operational or upon its closure. The report is very timely because the queue for new SCs requires us to commit to either them, or plant conversions, long before these power stations close. We explain what SCs are, what they do, and the options discussed in the report.

BY Ben Skinner Jul 20 2023
Reliability standard ain’t broke

Reliability standard ain’t broke

Since market start the NEM has used a single and simple outcome metric for its reliability standard: “Unserved Energy” (USE). Essentially, we target an average of no more than 10.5 minutes off supply per customer per year from rotational load-shedding. In response to a Reliability Panel Review, the Australian Energy Council has published a report by Endgame Economics that theoretically contemplates the appropriateness of the existing standard in the transitioning power system and concludes that the existing simple USE output form approach remains the best approach for the future power system, just as it is in the current power system. Read more.

BY Ben Skinner Jul 13 2023
Default Prices: A fine balancing act

Default Prices: A fine balancing act

There has been much attention on recent regulated electricity tariffs in an environment where cost-of-living pressures continue to bite. The process of setting a regulated price tries to cater for industry and consumer needs but it is not a simple case of giving more to one than the other. The best-case scenario of a regulated price will see competition dampened. But in the worst scenario, retailers will go out of business, as was seen last week with two more retailer failures. We take a look at the latest decisions and what market indicators say about the effectiveness of the policies overall.

BY Jo De Silva Jun 22 2023
Energy storage assessment: Where are we now?

Energy storage assessment: Where are we now?

A new report from the CSIRO has highlighted the major challenge ahead in having sufficient energy storage available in coming decades to support the National Electricity Market (NEM) as dispatchable plant leaves the grid. The roadmap also provides a useful insight into the current maturity level of energy storage technologies, using the commercial readiness index (CRI), as well as a technical readiness level (TRL) framework. We take a look at what they found.

BY Carl Kitchen Jun 08 2023
Gas: Living in interesting times

Gas: Living in interesting times

It’s an interesting period for the gas market. Upstream, price caps remain, and have been extended for another 12 months. At the retail end of the market, there are changes afoot. The AER has made a draft decision seeking to solve issues arising from customers wanting to fully exit the gas market. Meanwhile Energy ministers have announced their intention to amend the National Gas Objective by adding an emissions objective. One thing’s for sure: gas will continue to find itself being pulled in many different directions. We take a look at recent developments.

BY Ben Barnes Jun 08 2023
OSM RIP

OSM RIP

After three years of work on the Operational Security Mechanism (OSM) rule change and reaching a Draft Determination last October, the Australian Energy Market Commission (AEMC) changed course last week with a guidance note that appears to call the whole thing off. The OSM was to be a mechanism by which the market operator could start assets that provide Essential System Services (ESS) to secure the power system. An automated tool that was meant to make it simple. So, what’s changed and where we are now? we take a look.

BY Ben Skinner Jun 01 2023
IEA: Australia steps up ambitions, but work still to be done

IEA: Australia steps up ambitions, but work still to be done

Australia has “stepped up” its climate ambitions with a trajectory compatible with the Paris Agreement but a clear policy roadmap is needed, according to the International Energy Agency’s latest Australian Policy Review. Since its last review in 2018, the analysis shows Australia is catching up to the emissions reductions pledged by other advanced countries. We take a look at some of the key findings in this assessment.

BY Australian Energy Council May 11 2023
A budget big on energy

A budget big on energy

The Albanese Government’s latest budget is big on the energy transition, while seeking to help manage energy cost pressures for households and businesses. There are energy-related elements to the budget ranging from funding to get auctions for the Capacity Investment Scheme underway through to energy efficiency support and additional funding for the ACCC to manage the Consumer Data Right. In the lead up to the budget there was also significant focus on electricity bill relief measures. We take a look at some of the key energy-related areas in the budget.

BY Australian Energy Council May 11 2023
Bittersweet farewell to Liddell

Bittersweet farewell to Liddell

Last week was another significant step along the path to a lower emissions power grid with the closure of the Liddell Power Station after 52 years of service. The length of service is quite an achievement - it’s estimated only around 1 per cent of thermal plants globally run beyond 50 years. The closure of the final unit was described as “bittersweet” while the lead up to the end of operations was heralded by commentary on perils to supply reliability and the potential for higher wholesale prices. But it wasn’t the first time it made the headlines in NSW.

BY Carl Kitchen May 04 2023
Carbon emissions: “Charismatic abatement” lacks compelling numbers

Carbon emissions: “Charismatic abatement” lacks compelling numbers

The latest Productivity Commission 5-year productivity inquiry report has again starkly highlighted the indirect carbon costs of a range of fragmented government policies that have emerged to drive emission reductions. The report includes updated and detailed analysis of the estimated carbon abatement costs of various measures across Australian jurisdictions. We take a look.

BY Carl Kitchen Apr 06 2023
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