MAR Consolidated Rule Change and Consultation Monitor

Current AEMO Consultations & Rule Changes – May 2016

AEMO produces this monthly update to provide participants and interested parties with a consolidated report of:

o AEMO-led Rule change proposals and timeframes (including upcoming system & process changes),

o Current consultations being run by AEMO.

For further information please contact [email protected].

AEMO Consultations

Sector Consultation Name and Objectives Dates, Contacts and Status

Gas i. STTM IIR 15-003 – Contingency Gas Publication Date 20 Aug 2015 Evidentiary Changes Current Status IIR Subs closed The proposed changes to the Procedures are to align with the National Gas Amendment (Contingency Gas Evidentiary Submissions Closed 17 Sept 2015 Changes) Rule 2015 No. 2, published by the AEMC on 7 May 2015. Notes: The proposed changes will reflect: On 20 August 2015 AEMO published the initial consultation. Submissions closed on 17  the process for trading participants to revise price steps September 2015. within their contingency bids or offers at the confirmation stage;  the scope of evidence that AEMO will require to determine the quantity of contingency gas provided; and  the method that AEMO will use to determine the resettlement charge payable to trading participants.

Elect v. Issues Paper Energy Adequacy Assessment Publication Date Nov 2015 Projection Reporting vi. National Electricity Rule 3.7C requires AEMO to Current Status EAAP Issues Paper publish an Energy Adequacy Assessment Projection every three months. AEMO considers Submissions Closed 20 Aug 2015 such quarterly reporting may not be necessary to achieve the objectives of this rule. This Issues Notes: Paper invites stakeholders to comment on the value of quarterly EAAP reporting. On 13 July 2015, AEMO published the initial consultation. Submissions closed 20 August 2015. Final Report release date TBC. In Nov 15, AEMO published the response to EAAP Issues Paper. AEMO will submit a rule change proposal to the AEMC.

Gas Publication Date 22 Jun 2012

AEMO RULE CHANGES & CONSULTATIONS – MAY 2016 Sector Consultation Name and Objectives Dates, Contacts and Status

x. IN031/11 Fast Track Process for release of Current Status Pending decision address enumerations (Gas) AEMO proposes extending the existing gas fast track process that Decision Due November 2016 currently applies to Street Type to other address attributes (Street Suffix, FlatOrUnitType, FloorOrLevelType, and Notes: PostalDeliveryType) and to harmonise the gas and electricity On 22 Jun 12, AEMO published the initial IIR, process. Currently the allowable values for these fields are which recommended that changes not proceed prescribed in the procedures and Participants have built their IT as there are insufficient benefits put forward by system in accordance with the procedures. This proposal also industry that could be considered substantive requires participants make IT systems changes so they align with enough to outweigh the perceived IT costs the aseXML enumerations XSD file allowable values. implied by some participants. Responses to the IIR closed on 20 Jul 12. Assessment of the responses are “on hold” as the GRCF considered that there may be potential that the proposed change for IN031/11 may be linked to a broader dual fuel review of customer and site address data which is targeted for 2014. On 25 Jun 14, AEMO published a Notice of time limit, advising a decision will be made by 2 Mar 15. On 13 Mar 15, AEMO published another Notice of time limit, advising a decision will be made by 5 Oct 15. On 1 Oct 15, AEMO extended the time to make a decision regarding the making of Procedures under the Ordinary Consultation Process. AEMO will now make its decision by 30 November 2016.

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Key – Stage of rule change AEMC is now undertaking consultation AEMO has formally submitted to the AEMC

AEMO is currently drafting the proposal AEMO is exploring the issue with external participants

Stage Sector Rule Change Name and Objectives Dates, Contacts and Status

AE xi. Application of offsets in the prudential Submitted to AEMC: 28 May 2015 M margin calculation Current Status: C Co xii. The Australian Energy Market On 10 Dec 2015, the AEMC published the ns Commissions (AEMC) has commenced initial consultations paper. Submissions closed ult consultation on a rule change request from 4 February 2016. the Australian Energy Market Operator ati The AEMC has extended the period of time to (AEMO) to amend the National Electricity on make a draft determination. The draft Rules (NER) in relation to the application of determination will be published on 30 June offsets in the prudential margin calculation. 2016. The rule change request was received on 28 May 2015. xiii. The Australian Energy Market Commission’s (AEMC) consultant, Promontory, is due to provide a draft report on the Rule change proposal on 29 April. AEMC is expected to have a draft determination by 30 June.

Elect Demand Response Mechanism Submitted to AEMC: 30 March 2015

AEMO RULE CHANGES & CONSULTATIONS – MAY 2016 Stage Sector Rule Change Name and Objectives Dates, Contacts and Status

AE Current Status: M On 5 November 2015, The AEMC has C The DRM is a mechanism for measuring and valuing published a consultation paper to facilitate Co demand response by electricity consumers. The AEMC public consultation with stakeholders. ns developed a specification to be used by AEMO in developing Submissions closed 10 December 2015. ult a detailed design in the form of a rule change for ati consideration by COAG EC. COAG EC have largely On 16 February 2016, the AEMC has on accepted the design and prepared a cost-benefit analysis of published the S107 Notice which advises the proposal. that the draft determination on Demand response mechanism and Ancillary Proposed by: Services has been extended to 9 June COAG Energy Council. 2016. Proposed changes: xiv. New category of registered participant “Demand Response Aggregator”, DRAs would be made financially accountable for demand response load, procedures to provide for demand response notices and an obligation to take reasonable steps to reduce load when a DR notice has been provided, new process to measure demand response by deducting actual demand from a calculated baseline load.

Submitted to AEMC: 24 November 2015

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Su Energy Adequacy Assessment Projection (EAAP) Rule Current Status: bm Change The AEMC has not yet initiated the rule itte change process for this request. When this d Issue: process is initiated, the AEMC will publish a by The EAAP was first implemented in 2007 as a response to consultation paper to facilitate stakeholder AE the prolonged drought that drove concerns of energy consultation. M availability issues in the National Electricity Market (NEM). On 17 March 2016, the AEMC published the O initial consultation. Submissions closed 21 Since the end of the drought in 2007-08, the NEM has April 2016. become less vulnerable to drought situations to maintain reliability. Additional capacity has been added that is not On 19 May 2016, the AEMC published the reliant on water for generation, and desalination plant have final rule determination. been built in Victoria and New South Wales, reducing the likelihood that fossil fuel-fired generators will have output restricted in future due to limitations on access to cooling water in future. Therefore, AEMO considers that the need for, and value of, quarterly EAAP reporting has now diminished. AEMO understands there is value in a centralised assessment of energy constraints that could impact energy availability, however, a quarterly EAAP assessment, in the absence of a water shortage or other trigger event, is most likely achieved at a net cost to consumers. Proposed Changes: AEMO proposed on 27 November 2015 to reduce the frequency of publication of the EAAP from quarterly to annual, and include a trigger based mechanism for additional reporting. The proposed rule would amend rule 3.7C of the National Electricity Rules (NER). On 24 March, the AEMC reviewed AEMO’s proposal and suggested an alternate rule change which entails the following :  AEMO to clearly define the factors for triggering additional EAAP reporting and associated timing for GELF parameters.  AEMO to publish EAAP annually.  Scheduled generators to update GELF parameters annually instead of quarterly while retaining the obligation to report material changes to any generating units that have an impact on energy constraints. Next steps:  AEMO will be running consultations from 30 May 2016 onwards to seek industry input in relation to the determination of the ‘factors’ that may trigger additional EAAP reporting, and revised EAAP guidelines and RSIG. The consultation scope also includes discussion on validity of the current “dry scenario”.

AEMO RULE CHANGES & CONSULTATIONS – MAY 2016 Stage Sector Rule Change Name and Objectives Dates, Contacts and Status

Su Registration of Storage Providers Submitted to AEMC: 11 February 2016 bm itte AEMO has prepared a NER change proposal to facilitate the Current Status: registration of storage providers. d On 14 April 2016, the AEMC published the by Proposed by: initial consultation. Submissions close 12 May AE AEMO 2016. M Issue: On 26 May 2016, the AEMC published the O Chapter 2 of the NER effectively only permits the registration final rule determination. of storage providers as Generators or Customers. Registration as a Generator is not feasible as a storage system does not meet the definition of a ‘generating unit’, however, the technical requirements imposed on Generators appear to be the best ‘fit’ from a technical point of view. Although no applications for registration have been received to date, there have been a number of inquiries. Proposal: AEMO submitted a NER change to facilitate registration of storage providers as Generators to the AEMC on 11 February 2016. The AEMC started consultation on a rule change request in April 2016. The AEMC is assessing this rule change request as a non-controversial rule under an expedited process, subject to the receipt of any written objections from stakeholders by 28 April 2016. A consultation paper has been prepared to facilitate public consultation on the rule change proposal and to seek stakeholder submissions. Submissions on the rule change proposal close Thursday 12 May 2016.

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