The Australian Energy Regulator (AER) has been consulting on its approach to incentivising and measuring export service performance.
This forms part of a reform program to strengthen customer protections and our regulatory oversight of export services provided by distribution networks. These reforms follow the Australian Energy Market Commission’s recent rule change relating to access, pricing and incentive arrangements for distributed energy resources. This consultation jointly reviews on three interrelated reform workstreams, including:
- whether incentive arrangements for export services are fit for purpose.
- the development of performance metrics to include in our first annual DNSP export service performance report. These reports will consider, among other things, the relative performance of each DNSP in providing export services, DNSPs use of static zero export limits and performance relative to export tariff offerings.
- how to best incorporate export services into our annual benchmarking report.
- introduce reputational incentives via annual export service performance reporting. In order to prepare these annual reports, the AER will collect new data from DNSPs related to export service performance.
- introduce a new small-scale incentive scheme for export services (the export service incentive scheme, or ESIS), allowing DNSPs to consult with customers and propose bespoke export service incentive arrangements. The AER does not propose to amend the service target performance incentive scheme at this time.
- undertake a future review of incentive arrangements and its approach to incorporating export services into annual benchmarking reports.
The AER will commence this review by 2027 but may do so earlier if there are improvements in data availability and quality. This review will also consider whether amendments to the distribution reliability measures guidelines, demand management incentive scheme and demand management innovation allowance mechanism are necessary. The AER does not consider it necessary to amend these guidelines at this time, but it may do so in the future.