On 1 July 2005 the AER assumed the Australian Competition and Consumer Commission's (ACCC) responsibilities for the regulation of transmission revenues in the National Electricity Market. Under clause 6.20.2 of the National Electricity Rules, the AER is required to develop ring-fencing guidelines.
The guidelines require a transmission network service provider (TNSP) to ensure legal and operational separation of their transmission business from other related businesses. A related business under the guidelines include electricity generation, distribution or retail supply.
The ring-fencing guidelines, initially developed by the ACCC, separate the accounting and functional aspects of regulated transmission services from other services provided by TNSPs. All TNSPs must comply with these guidelines under clause 6.20.1 of the National Electricity Rules.