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Legislative Council - Fifty-First Parliament, Third Session (51-3)
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NATIONAL ELECTRICITY (SOUTH AUSTRALIA) (NATIONAL ELECTRICITY LAW—AUSTRALIAN ENERGY MARKET OPERATOR) AMENDMENT BILL

Introduction and First Reading

Received from the House of Assembly and read a first time.

Second Reading

The Hon. P. HOLLOWAY (Minister for Mineral Resources Development, Minister for Urban Development and Planning, Minister for Small Business) (22:26): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation inserted in Hansard without my reading it.

Leave granted.

The Government is again delivering on a key energy commitment through new legislation to improve the governance arrangements of the Australian energy sector, for the benefit of South Australians and all Australians.

In April 2007, the Council of Australian Governments (COAG) agreed to establish a single, industry-funded national energy market operator, to be called the Australian Energy Market Operator (AEMO), for both electricity and gas to strengthen the national character of energy market governance. This Bill and the accompanying amendments to the National Gas (South Australia) Act 2008 implement this commitment.

In its report to COAG recommending the establishment of AEMO, the Energy Reform Implementation Group considered that the main benefits of establishing AEMO were:

(a) More efficient outcomes for the energy market arising from information sharing leading to an improved understanding of market operations and interactions between the gas and electricity sectors;

(b) Improved emergency management coordination;

(c) Economies of scale arising from common information technology systems for gas and electricity (for market operation, system monitoring and information gathering);

(d) The provision of a single interface for energy market participants reducing red tape and duplication of interactions, thereby lowering costs;

(e) Administrative cost savings in corporate support structures; and

(f) A more substantive organisation able to attract and retain a core mass of appropriate expertise.

In accepting this recommendation, COAG noted that in conjunction with other governance initiatives, the creation of AEMO will provide a solid foundation for the long term development of Australia's energy market.

These amendments seek to realise these gains with minimal changes to the existing regulatory frameworks. While these amendments are only minimal changes to the framework, it is intended that AEMO will serve as a platform for future energy market reforms such as the anticipated gas short term trading market.

AEMO will perform a range of new functions. These amendments confer the new electricity National Transmission Planner (NTP) function on AEMO and amendments to the National Gas (South Australia) Act 2008 will empower AEMO to prepare the Gas Statement of Opportunities (GSOO).

As well as the new functions AEMO will take over the functions currently performed by the Gas Market Company (GMC) in New South Wales, the National Electricity Market Management Company (NEMMCO), the Victorian Energy Networks Corporation (VENCorp), the Queensland Gas Retail Market Operator (GRMO), the Retail Energy Market Company's (REMCo) South Australian functions and the planning functions currently performed by this State's Electricity Supply Industry Planning Council (ESIPC).

As is currently the case with NEMMCO, AEMO will be a not for profit company limited by guarantee. An important component of the current reform is to provide energy industry participants the opportunity to become members of the company, thereby providing industry stakeholders with a direct role in oversight of the market company in partnership with government members to provide efficient and effective energy markets. Importantly, government members will retain 60 percent of the voting rights while industry members will have the remaining 40 percent of voting rights, with these arrangements subject to review after three years. The initial members of AEMO will include all jurisdictions other than Western Australia and the Northern Territory as well as energy supply side entities.

NEMMCO

These amendments allow AEMO to take over all of the functions currently performed by NEMMCO under the National Electricity Law (NEL) and National Electricity Rules (NER). These functions are principally to operate the wholesale electricity exchange, to manage retail customer transfers and to promote the development of the national electricity market. NEMMCO's market operator functions are not being substantially altered as a result of the establishment of AEMO. This Bill makes minor technical amendments to the Law and Rules to allow AEMO to take over these functions. These principally involve changing references in the legislation from NEMMCO to AEMO.

National Transmission Planner

A major new electricity function of AEMO will be its role as the National Transmission Planner.

On 13 April 2007, COAG agreed to the establishment of an enhanced planning process for the national transmission network to ensure a more strategic and nationally coordinated approach to transmission network development. COAG noted that this would provide guidance to private and public investors to help optimise investment between transmission and generation across the power system and inform transmission companies' investment decisions as well as the Australian Energy Regulator's (AER) regulatory reset processes associated with the economic regulation of transmission assets.

In July 2007, MCE requested the Australian Energy Market Commission (AEMC) to undertake a review to develop the framework for the establishment of the NTP, including developing a detailed implementation plan for a NTP function. The AEMC's final report that included proposed changes to the NEL and the NER was provided to the MCE on 30 June 2008. In November 2008 the MCE published its response to the Report's recommendations, with that policy framework being the basis of these amendments.

The principal task of the NTP will be to ensure the strategic, nationally focussed and efficient development of the grid. Section 49(2) of the amendments to the NEL defines the core elements of AEMO's NTP function, including to:

prepare, maintain and publish a plan for the development of the national transmission grid (the National Transmission Network Development Plan or NTNDP);

establish and maintain a public database of information relevant to planning the development of the national transmission grid;

keep the national transmission grid under review and provide advice on the development of the grid or projects that could affect the grid; and

provide a national strategic perspective for transmission planning and co-ordination.

As was highlighted in the MCE response, the NTP's independent, strategic view of the network will add value to the regulatory test assessments and the AER's revenue resets for Transmission Network Service Providers (TNSPs). This is because AEMO's ability to make submissions will assist in ensuring that local network investments complement the broader strategic direction of the network. This recognises that even small investments in one section of the network could potentially have significant impacts on the wider grid. It is intended that AEMO will adopt disciplines in this role to ensure submissions are only made on relevant proposals.

The response also recognised that national transmission flow paths is flexible enough to consider both primary and secondary elements of the transmission network and enables it to adapt over time with changing flows on the network and the development of new technologies and usage patterns. Importantly, the response noted that the definition of national transmission flow paths for the purposes of AEMO's national transmission planning function is not constrained by the current interpretation of national transmission flow paths.

Further detail regarding the performance of these functions will be contained in the NER.

The NTNDP must be published no later than 31 December each year (for the coming year), with the requirement for the first publication to be no later than 31 December 2010. The NTNDP will present a broad and deep analysis of different future supply and demand scenarios for National Transmission Flow Paths, taking into account various policy, technology and economic assumptions and forecasting out at least 20 years from the beginning of the year in which the NTNDP applies. Information within the NTNDP, such as current and future congestion and transmission development strategies under a range of scenarios, will enhance the ability of the market to identify and respond to investment issues in an economically efficient and timely fashion.

There will be strong inter-linkages between AEMO's NTP function and TNSP planning. The NTNDP will include a consolidated summary of each TNSP's Annual Planning Report (APR) and additionally have regard to these reports. In preparing the NTNDP that is to be published, AEMO must also have regard to:

(a) the most recent electricity Statement of Opportunities (SOO) that has been published;

(b) the most recent GSOO that has been published; and

(c) the current revenue determination for each TNSP.

This is complemented by amendments to the NER which will require TNSPs to explain in their APRs how their proposals relate to the current NTNDP and current or future development strategies for national transmission flow paths.

The NTNDP provisions define an annual stakeholder consultation process that AEMO will be required to undertake in the production of the NTNDP. This consultation will allow market participants to make written submissions on the proposed NTNDP inputs, the content of the NTNDP as it applies for the current year and on issues raised in a statement of material issues for the NTNDP to be published by AEMO. Further, AEMO will be required to establish and maintain a publicly available database of key inputs into the NTNDP. To support these functions AEMO will be empowered to issue Market Information Orders (MIO) and Market Information Notices (MIN) to gather information from relevant participants as discussed further under Information Gathering.

Included in the NER draft are a number of amendments to the NER which allow for the transfer of the functions of the Inter-Regional Planning Committee (IRPC) to AEMO. The 13 April 2007 COAG decision required the role of the IRPC to be subsumed by the NTP function. The functions of the IRPC are largely technical in nature and cover a wide range of operational and planning activities. To the extent they are not made redundant by the new NTP arrangements, the functions will be retained and transferred to AEMO.

AEMO's Additional Advisory Functions

The enhanced strategic planning function of the NTP will necessitate the establishment of regional offices of AEMO to ensure there is a comprehensive understanding of regional issues while also providing a critical mass of independent technical expertise in network planning, AEMO will also take responsibility for the planning functions currently performed by the South Australian Electricity Supply Industry Planning Council (ESIPC) under the Electricity Act 1996. These functions are included in Subdivision 2 of Division 2 of Part 5 of the NEL and are described as 'Additional Advisory Functions.'

These amendments will allow AEMO to provide the planning services currently provided by ESIPC in South Australia. These provisions allow AEMO to conduct more detailed electricity network planning in South Australia in addition to the work it will undertake nationally as the NTP. AEMO will also have a specific role in providing information to the South Australian Government to assist in the management of the energy sector. ESIPC's functions with regard to emergency management will be retained within the South Australian jurisdiction.

AEMO will be empowered to use its new information gathering powers to collect information to assist it to perform its additional advisory functions.

The additional advisory functions are described generically in the NEL and NER in a manner that allows them to be operational only when applied by the jurisdiction through application legislation. They are applied in South Australia by a provision of the principal Act to be inserted by this Bill.

Declared Network Functions

AEMO will take over the functions currently performed by VENCorp. VENCorp is a State owned entity within Victoria.

VENCorp's principal electricity functions are the provision of electricity transmission services, electricity transmission planning and direction of augmentations for the privately owned transmission system in Victoria.

The VENCorp electricity functions are described generically in the Law in a manner that facilitates their application by a jurisdiction through its application legislation. They are described as part of AEMO's 'adoptive jurisdiction' functions.

The VENCorp electricity transmission functions are described as 'declared network functions' that will apply only where the jurisdiction has invoked the relevant part of the NEL. Currently it is intended that only Victoria will apply these provisions in its application legislation.

Fees and Cost Recovery

The legislative amendments seek to establish an effective cost recovery regime across electricity and gas that allows AEMO to fund the delivery of the services it is statutorily required to provide. The key features of this regime are that the costs borne by participants should reflect the costs incurred by AEMO in providing services to the participant, and that there should be no cross subsidisation between AEMO's different functions.

To achieve these aims the amendments retain NEMMCO's cost recovery model for electricity and expand it to AEMO's new gas functions. As such, amendments to the NGL will include requirements for AEMO to:

(a) prepare and publish, before the beginning of each financial year, a budget of AEMO revenue requirements for that financial year. The budgeted revenue must take into account and separately identify projected revenue requirements to support forecast expenditure for AEMO's identified lines of business; and

(b) develop and consult on the participant fee structure for its various functions in accordance with various cost recovery principles. There will also be an ability to dispute the participant fee structure.

These amendments also clarify AEMO's capacity to recover costs that are common between the two industries and permits AEMO to spread costs over multiple years to smooth their impact on participants.

These NEL amendments include the ability for AEMO to recover the costs associated with its new NTP function, new GSOO function, as well as the additional advisory function. The mechanism for recovery of the costs of AEMO's declared network functions will continue to be regulated through Chapter 6A of the NER, with relevant modifications to reflect the broader AEMO cost recovery model and the respective roles of AEMO and a relevant TNSP. Those modifications will apply in place of the current Victorian derogations in Chapter 9 of the NER.

Relevant amendments to Chapter 6A of the NER will ensure that AEMO's revenue for its Victorian TNSP function is not subject to approval by the AER. However, AEMO will be required to prepare a revenue methodology which will be subject to public consultation.

To minimise disruption, under the amendments to the NGL, the cost recovery frameworks of the existing market operators will be retained for a minimum of two years with a review no later than three years after AEMO's establishment. The result of this is that for the first two years of operation AEMO's fees and charges will be determined on the same basis as they were by the former market operators.

Information Gathering

The MCE supports broad and clear information gathering powers for AEMO's national transmission planning function. This will allow AEMO to undertake its function effectively, and ensure cooperative working relationships are formed between AEMO and market participants. These amendments introduce a new information gathering framework for AEMO which will be common across its new electricity and gas functions. The common framework will provide AEMO with a flexible, effective and transparent mechanism to gather information required to undertake its new functions.

The MCE notes the stakeholder comments regarding the broader information gathering arrangements the legislation includes to support the development of the NTNDP and a comprehensive gas Statement of Opportunities. MCE is confident that the combination of AEMO's governance arrangements and the protections in the law will ensure the appropriate use of these instruments. The key protections built into the framework are:

(a) the restriction of the use of the instruments to specific functions listed in the Law;

(b) an obligation on AEMO to consult prior to issuing an instrument;

(c) the requirement that the issuing of the instrument is reasonably necessary for the performance of AEMO's functions; and

(d) the requirement to have regard to the reasonable costs of efficient compliance in considering whether to issue a MIO or MIN.

MCE expects that AEMO will use these powers prudently. In this regard, MCE appreciates the cooperative approach between market participants and NEMMCO with respect to information provision for the Statement of Opportunities and the Annual National Transmission Statement to date, and hopes that cooperation will continue to be the basis of the relationship between market participants and AEMO. MCE does not consider that the powers should replace the existing cooperative approach to information gathering.

The amendments to the NEL will allow AEMO to issue MIOs and MINs to support its functions as NTP, operator of the Victorian declared network and planning functions and in its role in providing additional advisory service in South Australia. The corresponding gas amendment allows AEMO to use MIOs and MINs to assist it to prepare the GSOO and to perform its role under the Victorian declared system functions.

The provisions for MIOs and MINs are based upon the regulatory information order and notice provisions that are currently in both the NEL and the National Gas Law (NGL) and apply to the AER. This model was recommended by the AEMC in its NTP Final Report and was supported by the MCE in its response to this report.

The proposed amendments to the NEL allow a MIO or MIN to be issued to any person, including TNSPs, generators and others to support AEMO's planning and advisory functions. This is necessary in view of the type of information that will need to be gathered to support the intention for a broad and deep analysis of future supply/demand scenarios. The accuracy of these scenarios will be dependent on gathering data from existing generators and new entrant generators as well as TNSPs.

As noted, MCE expects that the legislative checks and balances in the information gathering arrangements will continue to facilitate a co-operative approach between industry and AEMO. Governments will, through the MCE, maintain an interest in the implementation of the information gathering arrangements and will take into account industry and regulator feedback on their appropriateness, effectiveness and efficiency over time.

An important benefit of establishing AEMO is that it can improve the exercise of all of its various functions by sharing information gathered in the performance of individual functions. The NEL (and the NGL) allows AEMO to use all information gathered under any of its information gathering powers, including MINs and MIOs for any purpose connected with the performance of its statutory functions.

These amendments also allow AEMO to disclose information to specified energy market institutions. This is because one of the benefits of establishing the national regime is the opportunity to maximise the efficiencies and synergies that may be achieved. It should be noted that passing information to third parties will be subject to judicial review.

To ensure that these information gathering powers are effective these amendments contain provisions that require the recipient of a MIO or MIN to comply with it and failure to do so will be prescribed by regulation as a civil penalty. AEMO may, however, grant persons a general or specific exemption from compliance with a MIO and the issuing of MIOs and MINs will be subject to judicial review.

Consistent with other similar provisions regarding the provision of information to bodies performing statutory functions, providing information that is known to be false or misleading in response to a MIO or MIN will be a criminal offence.

Protected Information

These amendments strengthen confidentiality obligations by elevating these obligations from the Rules into the Law. The proposed Division 6 of Part 5 of the NEL (and included in the NGL) sets out obligations on AEMO in respect of protected information. Under the proposed legislation, AEMO will have an obligation to take all reasonable measures to protect from unauthorised use or disclose information:

(a) given to it in confidence; or

(b) given to it in connection with the performance of its statutory functions and classified under the Rules as confidential information.

This is consistent with the approach adopted for similar confidentiality obligations imposed on the AER and the AEMC by s44AAF of the Trade Practices Act 1974 (Cth) and s24 of the Australian Energy Market Commission Establishment Act 2004 (SA) respectively. The relevant provisions substantially replicate the current rule 8.6 of the NER.

Consequential amendments to rule 8.6 are being made to remove the obligations imposed by that rule on NEMMCO, while preserving the obligations set out in the rule on Registered Participants. The remaining provisions dealing with confidential information in the NER continue to operate essentially unamended.

An identical regime for the treatment of protected information is proposed for the NGL and National Gas Rules (NGR) and underpinning Procedures. This is intended to replace the principal substantive obligations in relation to confidential information currently operating under the jurisdictional retail market rules and the Victorian wholesale gas Market System Operation Rules (MSOR). Certain variations are proposed to the equivalent of rule 8.6 in the NGR to adapt the rule for the purposes of the gas framework. These are based substantially on VENCorp's retail market rules.

As mentioned, section 54C of the NEL amendments will allow AEMO to share information with energy industry regulatory bodies, including the AER. This provision replicates similar arrangements for the AER and AEMC. The purpose of these provisions is to ensure efficient information transfer between different energy market bodies to ensure the effective operation of the regulatory framework.

Immunities

These amendments retain the existing NEMMCO immunities in Part 9 of the NEL for AEMO, and a new set of provisions in the NGL, so that these provisions will now apply to AEMO when performing any of its functions under the NEL and NGL.

The amendments also elevate two key immunities from the NER into the NEL, these provisions have been moved as it was considered more appropriate to deal with limitation on liability in the NEL than the NER.

The new section 120A replicates the existing rule 3.17.2 (which will be consequentially omitted) and provides immunity for contractors providing software to AEMO. While the existing immunity for arbitrators and mediators has been moved from rule 8.2.12 to the new section 120B for electricity (and replicated for gas).

The NGL amendments also contain additional immunities for specific to AEMO's role in gas. A new provision in the NGL is designed to protect service providers when disconnecting customers in compliance with the NSW user exit rules. The current immunities that apply to VENCorp when operating the Victorian wholesale market have also been replicated. Additionally the transitional provisions preserve existing immunities under the current South Australian retail market rules until the expiry of certain existing contracts.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

This clause is formal.

2—Commencement

The measure will be brought into operation by proclamation.

3—Amendment provisions

This clause is formal.

Part 2—Amendment of National Electricity (South Australia) Act 1996

4—Amendment of section 12—Specific regulation-making power

5—Amendment of section 14—Freedom of information

These amendments make consequential changes on account of the arrangements around AEMO (previously known as NEMMCO).

6—Insertion of Part 7

This provision is necessary in order for AEMO's advisory functions set out in Part 5 Division 2 Subdivision 2 of the NEL (as enacted by this Act) to apply in South Australia.

Part 3—Amendment of National Electricity Law

7—Amendment of section 2—Definitions

This clause provides new definitions for the definition section (section 2) of the National Electricity Law.

8—Amendment of section 11—Electricity market activities in this jurisdiction

This clause makes consequential amendments as a result of NEMMCO's name being changed to AEMO.

9—Amendment of section 12—Registration or exemption of persons participating in national electricity market

This clause makes consequential amendments as a result of NEMMCO's name being changed to AEMO.

10—Substitution of section 14

14—Evidence of registration or exemption

This clause provides that a certificate certifying that a person is a registered participant is conclusive evidence, where signed by an authorised officer (from AEMO or AER, as circumstances require).

11—Amendment of section 15—Functions and powers of AER

This clause places certain restrictions on AER's powers with respect to AEMO.

12—Amendment of section 16—Manner in which AER performs AER economic regulatory functions or powers

This clause makes consequential amendments as a result of the possibility of AEMO being affected by a determination by AER.

13—Amendment of section 28M—Further provision about manner in which information must be provided to AER or kept

This clause makes minor changes to section 28M.

14—Insertion of section 28ZAB

28ZAB—Disclosure of information that has entered the public domain

This clause permits AER to disclose information that is already in the public domain.

15—Amendment of section 28ZB—Disclosure of confidential information authorised if detriment does not outweigh public benefit

This clause makes consequential amendments as a result of the addition of section 28ZAB.

16—Amendment of section 34—Rule making powers

This clause makes consequential amendments as a result of NEMMCO's name being changed to AEMO.

17—Substitution of Part 5

Part 5—Role of AEMO under National Electricity Law

Division 1—General

49—AEMO's statutory functions

This clause outlines AEMO's statutory functions, including as the National Transmission Planner.

49A—AEMO's power to carry out statutory functions

This clause provides that AEMO has the power to do all things necessary or convenient for or in connection with its statutory functions.

49B—Delegation

This clause provides the conditions on which AEMO may delegate its powers or functions to its officers and committees.

Division 2—AEMO's adoptive jurisdiction functions

Subdivision 1—Preliminary

50—Application of this Division

This clause describes the application of this Division.

50A—AEMO to account to relevant Minister for performance of adoptive functions

This clause requires AEMO to provide information about the performance of its adopted functions with respect to a jurisdiction if the Minister of that jurisdiction requests so in writing, it requires AEMO to identify any protected information and prohibits a fee for being charged for this service.

Subdivision 2—AEMO's additional advisory functions

50B—Additional advisory functions

This clause describes AEMO's additional advisory functions to include providing reports on an adoptive jurisdiction's power system or matters relevant to the future capacity and reliability of the declared power system.

Subdivision 3—AEMO's declared network functions

50C—AEMO's declared network functions

This clause outlines AEMO's declared network functions.

50D—Network agreement

This clause outlines the need for, and requirements of, declared transmission system operators to make a network agreement with AEMO for the provision of electricity network services, and provides that a transmission determination prevails to the extent of any inconsistency.

50E—Connection agreements

This clause provides the need for certain agreements to be in place where certain network service providers or users want to connect to a declared shared network but the fault levels would be likely to exceed those fixed under the Rules, and allows AEMO to require the applicant to make a contribution to the cost of network augmentation necessary to reduce the fault levels.

50F—Augmentation

This clause prohibits augmentation of a declared shared network without authorisation from AEMO or the Rules, outlines the conditions on which AEMO may authorise augmentation and requires a declared transmission system operator to do anything necessary to facilitate this.

50G—AEMO to have qualified exemption for performing statutory functions

This clause provides that AEMO need not be a Registered Participant and is not subject to those Rules applying to network service providers, unless they are specifically expressed to apply to AEMO.

50H—Resolution of dispute arising from attempt to negotiate a network agreement or augmentation connection agreement

This clause provides the circumstances under which the AER may determine a dispute relating to negotiation of a network agreement or augmentation connection agreement, which is then binding on interested parties.

50J—General principles governing determinations

This clause provides general principles for the AER making determinations under this Subdivision.

Division 3—Information etc to be provided to Ministers

51—Ministerial request

This clause enables MCE or Ministers of participating jurisdictions to ask AEMO for information, and provide a written statement of the purpose for which this is sought.

51A—Compliance with request

This clause requires AEMO to comply with a request under this Division, and mandates that protected information may only be disclosed under such a request if authorised under this Law or the Rules.

51B—Quarterly report

This clause requires AEMO to report quarterly to MCE on requests made under this Division, summarising each request and by whom it was made.

Division 4—Fees and charges

52—AEMO fees and charges

This clause enables AEMO to determine and levy fees and charges, on a non-profit basis to enable costs over time to approximate revenue.

Division 5—Information gathering

53—Information gathering powers

This clause enables AEMO to make orders, either to persons or a class of persons, requiring the provision of certain information in relation to specified functions.

53A—Making and publication of general market information order

This clause provides the conditions for making a general market information order, including consultation and publication requirements.

53B—Service of market information notice

This clause provides the conditions for making a market information order to a person, including consultation and publication requirements.

53C—Compliance with market information instrument

This clause outlines the need for, and conditions surrounding, compliance with a market information order and protects a person for civil liability for compliance.

53D—Use of information

This clause enables AEMO to use any information obtained for any purpose connected with the exercise of AEMO's statutory functions, subject to this Law, and the Rules, Regulations and Procedures.

53E—Providing false or misleading information

This clause provides penalties for knowingly providing false or misleading information in response to a market information order.

Division 6—Protected information

Subdivision 1—AEMO's obligation to protect information

54—Protected information

This clause requires AEMO to prevent information given to it in confidence or in connection with its statutory duties from being used or disclosed in a way contrary to this Law, the Rules or Regulations.

Subdivision 2—Disclosure of protected information held by AEMO

54A—Authorised disclosure of protected information

This clause authorises AEMO to disclose protected information in accordance with this Subdivision, or as authorised by the Rules or Regulations.

54B—Disclosure with prior written consent

This clause authorises AEMO to disclose protected information if it has the written consent of the person from whom the information was obtained.

54C—Disclosure required or permitted by law etc

This clause authorises AEMO to disclose protected information under certain laws or to certain bodies and the use of that information in connection with the performance of functions or exercise of powers of that body.

54D—Disclosure for purposes of court and tribunal proceedings

This clause authorises AEMO to disclose protected information for the purposes of court or tribunal proceedings.

54E—Disclosure of document with omission of protected information

This clause enables AEMO to disclose documentation with both protected and unprotected information by omitting the protected information.

54F—Disclosure of non-identifying information

This clause enables AEMO to disclose protected information provided the information and its disclosure cannot lead to the identification of the person to whom that information relates.

54G—Disclosure of protected information for safety, proper operation of the market etc

This clause enables AEMO to disclose protected information when necessary for the safety, reliability, security and supply of electricity or the national electricity system, for the proper operation of the national electricity market, where the information is customer profiling information for facilitating retail competition, or where the information is in the public domain.

54H—Disclosure of protected information authorised if detriment does not outweigh public benefit

This clause enables, and outlines the conditions under which, AEMO to disclose protected information if disclosure would not detriment the person who has given it or a person from whom that person received it, or where the public benefit of disclosure outweighs that detriment.

Division 7—AEMO's statutory funds

55—Definitions

This clause defines Rule fund in this Division.

55A—AEMO's Rule funds

This clause vests existing Rule funds in AEMO and makes AEMO responsible for the administration of Rule funds.

55B—Payments into and out of Rule funds

This clause requires certain payments under the Rules and Procedures, including income from investment of money in a Rule fund, to be paid into that Rule fund, and requires payments out of a Rule fund to only be made in accordance with the Rules and Procedures or to pay liabilities or expenses of the Rule fund.

55C—Investment

This clause enables AEMO to invest money held in a Rule fund subject to the exercise of care, diligence and skill.

18—Amendment of section 58—Definitions

This clause makes consequential amendments as a result of the amendments to Part 5.

19—Amendment of section 62—Additional Court orders

This clause makes consequential amendments as a result of NEMMCO's name being changed to AEMO.

20—Amendment of section 69A—Commercial Arbitration Acts apply to proceedings before Dispute resolution panels

This clause amends section 69A. The amendment makes it clear that a referral of a Dispute which is to be dealt with under the procedural parts of a Commercial Arbitration Act will be subject to the operation of the relevant Act as if the matter were a referral to arbitration under an arbitration agreement.

21—Amendment of section 70—Applications for judicial review

This clause makes consequential amendments as a result of NEMMCO's name being changed to AEMO.

22—Amendment of section 71A—Definitions

This clause makes consequential amendments as a result of AEMO's power to make decisions to disclose information.

23—Amendment of heading to Part 6, Division 3A, Subdivision 3

This clause makes consequential amendments as a result of the amendment to section 71A.

24—Amendment of section 71S—Application for review

This clause makes consequential amendments to section 71S.

25—Amendment of section 71U—Determination in the review

This clause outlines the requirements of any determinations made under section 71U.

26—Amendment of section 71V—Tribunal must be taken to have affirmed decision if decision not made within time

This clause makes consequential amendments as a result of the cessation of AER.

27—Substitution of 71W

71W—Assistance from AER or AEMO

This clause makes consequential amendments as a result of AEMO's powers.

28—Amendment of section 72—Obligations under Rules to make payments

This clause makes consequential amendments as a result of NEMMCO's change of name to AEMO.

29—Amendment of section 87—Definitions

This clause makes consequential amendments as a result of NEMMCO's change of name to AEMO.

30—Insertion of section 90B

90B—South Australian Minister to make initial Rules related to AEMO's functions under this Law

This clause enables, and outlines the conditions on which, the South Australian Minister to make initial Rules and Procedures, upon recommendation by MCE.

31—Amendment of section 91—Initiation of making of a Rule

This clause limits the persons whose request may initiate the making of a new Rule by the AEMC and outlines limits to the AEMC's rule-making power.

32—Amendment of section 94—Initial consideration of request for Rule

This clause makes amendments to section 94.

33—Amendment of section 100—Right to make written submissions and comments in relation to draft Rule determination

This section makes consequential amendments as a result of changes in this Bill.

34—Amendment of section 101—Pre-final Rule determination hearings

This section makes consequential amendments as a result of changes in this Bill.

35—Substitution of section 102A

102A—Proposal to make more preferable Rule

This clause enables the AEMC to make a draft or final Rule determination with respect to what it considers to be a more preferable Rule, in view of the response to a draft Rule determination.

36—Amendment of section 109—Definitions

This clause makes consequential amendments as a result of AEMO taking over NEMMCO's powers.

37—Amendment of section 110—Appointment of jurisdictional system security coordinator

This clause enables AEMO to be appointed as a jurisdictional system security coordinator, subject to direction by the Minister of the relevant jurisdiction with respect to certain matters.

38—Amendment of section 111—Jurisdictional system security coordinator to prepare jurisdictional load shedding guidelines

This clause requires a jurisdictional system security coordinator to give to AEMO a copy of the jurisdictional load shedding guidelines, if AEMO does not have that role.

39—Amendment of section 112—NEMMCO to develop load shedding procedures for each participating jurisdiction

This clause makes consequential amendments to section 112 and requires AEMO to give to the jurisdictional system security coordinator a copy of the AEMO load shedding procedures.

40—Substitution of section 113

113—Exchange of information

This clause enables AEMO or the jurisdictional system security coordinator to share information about loads and load shedding with Ministers from participating jurisdictions, and other Ministers or officials responsible for public safety, or power system or gas system safety or security, to enable AEMO to maintain power system security.

41—Amendment of section 114—AEMO to ensure maintenance of supply of sensitive loads

This clause makes consequential amendments as a result of NEMMCO's change of name to AEMO.

42—Amendment of section 115—Shedding and restoring of loads

This clause makes consequential amendments as a result of NEMMCO's change of name to AEMO.

43—Insertion of section 115A

115A—Determination of customer load shedding arrangement

This clause empowers and outlines the conditions on which the Minister of a participating jurisdiction to determine arrangements between a Registered participant and AEMO, for customer load shedding, should they be unable to come to an agreement within 6 months.

44—Amendment of section 116—Actions that may be taken to ensure safety and security of national electricity system

This clause makes consequential amendments as a result of the insertion of section 115A.

45—Amendment of section 117—AEMO to liaise with Minister of this jurisdiction and others during an emergency

This clause makes consequential amendments as a result of NEMMCO's change of name to AEMO.

46—Amendment of section 118—Obstruction and non-compliance

This clause mandates and provides penalties for the failure to comply with a direction under section 116.

47—Amendment of section 119—Immunity of AEMO and network service providers

This clause makes consequential amendments as a result of NEMMCO's change of name to AEMO.

48—Amendment of section 120—Immunity in relation to failure to supply electricity

This clause makes consequential amendments as a result of NEMMCO's change of name to AEMO.

49—Insertion of sections 120A and 120B

120A—Immunity in relation to use of computer software

This clause grants immunity to AEMO, former gas market operators and their officers, employees and agents for loss suffered as a consequence of the use of computer software to operate a gas market.

120B—Immunity from liability—dispute resolution

This clause grants immunity from civil monetary liability to arbitrators, mediators, managers and facilitators of dispute resolution processes, unless done in bad faith.

50—Amendment of section 158—Failure to make a decision under this Law or the Rules within time does not invalidate the decision

This clause makes consequential amendments as a result of NEMMCO's change of name to AEMO.

51—Amendment of Schedule 1—Subject matter for the National Electricity Rules

This clause makes amendments to Schedule 1, relating to the subject matter for the National Electricity Rules, including defining the subject matter relating to AEMO and its role as the National Transmission Planner.

52—Amendment of Schedule 2—Miscellaneous provisions relating to interpretation

2A—Changes of drafting practice not to affect meaning

This clause provides that differences of language between provisions of this Law or the Rules may be explicable by reference to changes of legislative drafting practice and do not necessarily imply a difference of meaning.

31AF—Evidentiary certificates—AEMO

This clause enables authorised AEMO officers to issue a certificate as evidence that certain decisions or documents issued.

53—Amendment of Schedule 3—Savings and transitionals

Part 10—Transitional provisions related to AEMO amendments

19—Definitions

This clause amends the definitions under Schedule 3.

20—Interaction between this Part and jurisdictional transitional arrangements

This clause provides that this Part and any Regulations or Rules of a saving or transitional nature apply in a participating jurisdiction subject to any exclusions or qualifications made by or under an Act of the participating jurisdiction.

21—Recovery of costs of transition

This clause enables AEMO to recover the costs of transition through participant fees over a period of 4 years.

22—Transitional special project expenditure

This clause enables AEMO to recover the costs of transitional special project expenditure through participant fees over a period of 4 years.

23—Interpretation of obsolete references

This clause provides for references in instruments (including legislative instruments), to the former operator of a market that AEMO takes over, to be regarded as references to AEMO.

Debate adjourned on motion of Hon. S.G. Wade.


At 22:27 the council adjourned until Thursday 4 June 2009 at 11:00.


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