The Australian Competition and Consumer Commission has issued its draft determination on amendments to the National Electricity Code.
These Code changes deal with:
- the National Electricity Code Administrator’s (NECA) Reliability Panel’s review of the Value of Lost Load (VoLL); and
- NECA’s review of capacity mechanisms; and
- the code requirement that negative spot prices be allowed within twelve months of market commencement.
VoLL is a cap on prices in the National Electricity Market. It is currently set at $5,000/MWh.
"The ACCC has accepted NECA’s proposal to increase the level of VoLL in two stages to $20,000/MWh", ACCC Chairman, Professor Allan Fels, said today.
"The ACCC accepts NECA’s argument that the changes to VoLL are necessary to promote incentives to maintain system reliability in the NEM. The changes to VoLL should increase investment in generation capacity at the top end of the market, and achieve improved demand side response.
"However, the draft determination proposes a number of conditions of authorisation, requiring more stringent market monitoring measures in the NEM. The ACCC believes that more stringent market monitoring is necessary to address concerns about the impact of an increase in VoLL given current generator market power issues in the NEM".
The code changes dealing with capacity mechanisms and the negative floor price were accepted by the ACCC.
The ACCC now invites NECA and other interested persons to notify it by 5 July 2000 whether they wish the ACCC to hold a conference in relation to this draft determination.
Copies of the ACCC's draft determination will be available on the ACCC web site: http://www.accc.gov.au or from Ms Maxine Helmling on telephone (02) 6243 1246.