The National Gas Rules (NGR) exist to facilitate safe, reliable and efficient gas services in Australia. They weren’t designed to deal with shrinking gas networks and aren’t fit to promote consumer interests through the energy transition.
That’s why we’re challenging the Australian Energy Market Commission (AEMC) direction on gas network reform in our response to the Gas Networks in Transition Directions Paper.
The AEMC has not properly recognised why the rules are no longer fit for purpose, or the intent of our proposals in response. Their approach to network redundancy and accelerated depreciation inequitably shifts more risks and costs onto consumers and does not do enough to push gas networks to efficiently and fairly enable the transition. To bring reform closer to the intent of the JEC and ECA’s initial rule change proposals, we recommend:
- enabling the identification of uneconomic assets in advance and creating a mechanism to determine more equitable sharing of redundancy costs between consumers and network businesses;
- recognising the multiple drivers for electrification, the direction and impact of government policy, and the broader range of equity considerations, and;
- that the AEMC recommend jurisdictional and energy law changes needed to enable gas networks to pursue the most efficient options for consumers and the transition.
What’s next?
The AEMC will deliver a draft determination at the end of August. We’ll be engaging further throughout this process, as well as pursuing NSW regulatory reform and policy action to support an equitable transition for people relying on gas networks.
Read more:
Gas Networks in Transition Explainer
Joint response to the Gas Networks in Transition consultation paper
