JEC made a submission to the AER Review of electricity transmission service standards incentive schemes issue paper. The existing service target performance incentive scheme (STPIS) is not working effectively. The present design of the scheme does little to encourage transmission network service providers to improve their outage management. We recommended that the scheme be amended to better target rewards and penalties by focusing only on events that have a significant impact on wholesale prices.
JEC encouraged the AER to consider not just whether incentive payments under STPIS correlate with improved service reliability, but whether such schemes are working at least cost or most efficiently to deliver outcomes for consumers. There may be materially less costly mechanisms for ensuring improved service reliability and efficient utilisation.
