The Australian Energy Market Commission (AEMC) has proposed new rules to better equip the regulator to set network prices so consumers aren’t ripped off for reliable supplies of electricity and gas.
A draft determination released last week would allow the Australian Energy Regulator (AER) to benchmark electricity network businesses against each other. This would provide the AER with tools to determine efficient costs for each regulated business.
“Pricing rules for transmission businesses (2006) and distribution businesses (2008) were made at a time when the biggest concerns were the risk of underinvestment in infrastructure and meeting reliability standards put in place by the governments of the day,” said AEMC Chairman, John Pierce .
“The experience of the first full cycle of regulation tells us that improvements can be made – especially around the flexibility available to the regulator to adjust its approach to changes in operating environments.”
The AEMC is also working across the electricity and gas supply chains to identify other areas where changes can be made to improve the efficiency of the total system.
Mr Pierce said the draft rules were now available for public review and comment before a final decision is made. Submissions close on 4 October 2012 and a final determination and rule will be made in November 2012.
After years of being made the whipping boy in relation to electricity price rises – even though there was plenty of evidence showing otherwise – developments in recent weeks have seen Australia’s solar power industry vindicated. The myths and misinformation will become just another unfortunate footnote in Australia’s filthy fossil fuel soaked electricity generation history.
The issue of skyrocketing power prices was brought to a head earlier this month when Prime Minister Julia Gillard declared “massive prices rises have to stop” and pointed to the “gold-plating” of electricity infrastructure being a major driver of price hikes.
