Statement on AEMC on Market Discussion Papers

The Australian Energy Council Chief Executive Sarah McNamara said the challenges of efficiently coordinating generation and transmission investment are substantial.

“While we understand the AEMC’s desire to move this forward, we don’t know yet if its access proposal is consistent with the major market design reforms the Energy Security Board (ESB) is working on. “Ideally, this work, known as COGATI, should merge with the ESB’s post-2025 work. This need for better coordination was flagged by KPMG in its recent “Co-coordinating Electricity Market Reform” report, which we recently commissioned. That report highlights the challenges of having multiple bodies designing the market. “At a practical level the access proposal in this latest discussion paper is technically very complex to implement, and the July 2022 start date coincides with other major IT projects that will need to be implemented by market participants, including the demand response mechanism and five minute settlement.

“The AEC is also keen to understand the transitional arrangements to recognise existing access to the transmission system by generators. Whilst the need for these are recognised by the AEMC, the actual level and length of such arrangements are not yet clear.

“We look forward to providing our input on the AEMC’s proposals.”