The Australian Energy Regulator (AER) today published its draft Distributed Energy Resources (DER) Integration Expenditure guidance note.
The uptake of DER, such as rooftop solar photovoltaic units and battery storage, continues to increase across the NEM. This brings a range of benefits to all customers, but can present challenges to the way that electricity distribution networks operate.
The AER is developing a guidance note to ensure that electricity distribution networks prepare business cases for investments to accommodate DER in a consistent and transparent manner, so that customers only pay for network investments that deliver them benefits.
The draft guidance note formalises a number of the recommendations made by the CSIRO and CutlerMerz in their Value of DER (VaDER) report, including the types of DER benefits that may be quantified and how these should be quantified. It also provides guidance on developing a DER integration strategy, assessing network hosting capacity and defining base case investment scenarios.
The AER is now seeking submissions on the draft DER integration expenditure guidance note and is inviting stakeholders to a public forum on 5 August 2021.
Invitation for submissions
We invite interested parties to make submissions on our draft guidance note by 31 August 2021 (responding to questions listed in the explanatory statement). Please email submissions to AERinquiry@aer.gov.au.
Alternatively, you may mail submissions to:
Dr Kris Funston
Executive General Manager, Network Regulation
Australian Energy Regulator
GPO Box 520
Melbourne, Victoria, 3001
We prefer that all submissions be publicly available to facilitate an informed and transparent consultative process. We will treat submissions as public documents unless otherwise requested. All non-confidential submissions will be published on the AER’s website. For further information regarding the AER’s use and disclosure of information provided to it, see the ACCC/AER Information Policy.
We request parties wishing to submit confidential information:
- clearly identify the information that is the subject of the confidentiality claim
- provide a non-confidential version of the submission in a form suitable for publication.
The AER will host an online public forum to allow the opportunity to ask questions about its draft DER integration expenditure guidance note before submissions close on 31 August 2021.
The online public forum will be held 12 to 2pm (AEST) on 5 August 2021. To register your interest in attending the public forum, please email AERinquiry@aer.gov.au by 30 July 2021.
On 11 November 2020, the AER released the VaDER report produced by the CSIRO and CutlerMerz. This report recommended a methodology to determine the value of DER that can be used by networks in investment proposals to integrate DER into the grid.
On 25 March 2021, the AEMC published its draft determination for preferable draft electricity and retail rules to integrate DER more efficiently into the grid. Under the draft rules, the AER will be required to develop a 'customer export curtailment value' (CECV) methodology and publish values annually.
The guidance note does not yet provide advice on how distribution networks should quantify wholesale market benefits associated with new investments. The AER will await the AEMC’s final determination before consulting on this issue separately.
It is expected that the final DER integration expenditure guidance note and CECV methodology will be published in 2022, and first applied in the 2024-29 electricity distribution determinations for electricity distribution networks in New South Wales, Australian Capital Territory, Northern Territory and Tasmania.