The AER was launched on 1 July 2005. In this, the first of its independent reports for ejournal, the regulator’s roles and responsibilities are outlined and transitional access code variations are summarised.
The heads of the Australian Competition and Consumer Commission, Mr Graeme Samuel, and the Australian Energy Regulator (AER), Mr Steve Edwell, announced the commencement of the operation of the Australian Energy Regulator on Friday, 1 July 2005.
The AER is a new independent national body responsible for economic regulation in Australian energy markets and compliance with the electricity and gas rules at a national level. It has been established under the Trade Practices Act 1974 as a constituent part of the ACCC.
The establishment of the AER is an important milestone for energy regulation in Australia. The AER brings under one umbrella the regulatory functions formerly conducted by the ACCC, the National Electricity Code Administrator and will cover some functions undertaken by state regulators. The AER's relationship with the ACCC will encourage consistency in regulation between energy and other sectors of the economy. Bringing regulation under one body will reduce the complexity and compliance costs for business.
The AER is comprised of three members who are statutory appointments. Mr Edwell is the inaugural full-time chair of the AER. The other two members are Mr Ed Willett, a commissioner of the ACCC, and Mr Geoff Swier, a consultant with significant experience in energy market reform.
The AER will report monthly in ACCC ejournal.
For more information about the AER and its functions, see www.aer.gov.au.
The Transition Branch of the AER has responsibility for coordinating and developing input into legislative and rule change processes, the transfer of distribution functions to the AER, developing a relationship with the AEMC, and providing input into electricity merger issues. It also has a transitional role in electricity authorisations.
On 22 June 2005 the ACCC received a request from the NECA to vary the approved National Electricity Market access code (NEM access code). The variations sought to introduce changes to the code that had been authorised by the ACCC and gazetted since 1 March 2005, except to the extent that those changes related to chapter 3 of the code.
The ACCC released a draft decision on 27 June 2005 proposing to consent to NECA's request. The draft decision varies the NEM access code to include all of the code changes that had been authorised since 1 March 2005.
The following variations are covered by the draft decision:
New South Wales full retail competition metering derogation (20 May 2005)
extension of reserve trader sunset (20 May 2005)
Tasmania’s entry to the National Electricity Market (28 April 2005)
Victoria full retail competition metering derogation (21 April 2005)
New South Wales transmission revenue cap derogation (8 April 2005)
market ancillary services for Tasmanian entry (17 March 2005).
Submissions on the draft decision have been invited and the closing date is 11 August 2005.
The ACCC has sought comments on an application by APT Petroleum Pipeline Ltd (APTPP) made on 14 June 2005 to defer lodgment of revisions to its access arrangement for the Roma to Brisbane Pipeline (RBP). APTPP is currently due to lodge its revisions by 31 January 2006. The ACCC will take these into consideration when deciding whether to approve the extension of time for lodgment.
APTPP is seeking deferral until six months after the Federal Court releases its decision consequent to the ACCC’s appeal of the Australian Competition Tribunal’s determination regarding the Moomba to Sydney Pipeline access arrangement. APTPP notes that the outcome of that process is expected to influence the content and evaluation of the revised RBP access arrangement, particularly with respect to the derivation of the initial capital base.
On 7 July 2005 Central Ranges Pipeline Pty Ltd (CRP) sought an extension of time to lodge its access arrangement for the pipeline it is building to transport gas from Dubbo to Tamworth in NSW. CRP sought a similar extension from the Independent Pricing and Regulatory Tribunal (IPART) which is responsible for assessing the associated distribution access arrangement.
The requests are to allow CRP further time to develop its proposed access arrangements prior to formally lodging them. The ACCC and IPART are considering the respective requests.
