18 December 2017
PDF version [350KB]
Adrian Makeham-Kirchner
Economics
Energy has become a major electoral and
economic issue in Australia. To understand the complexity of the domestic
energy market—electricity and gas—requires access to a wide array of
information. As the issue is managed by both Commonwealth and state bodies, the
information can be disparate and difficult to access simply. This quick guide
provides a list of key Australian sources, and some high level international
resources, that assist in understanding the Australian energy market.
This guide does not outline parliamentary resources, such as
chamber records or committee inquiries.
Australian Government resources
The Department
of Environment and Energy (DEE) provides two key points of entry on energy,
and some benchmark statistical publications:
- The energy topic
page provides links to information on Australian Government programs and
general market overviews.
- The recently launched energy.gov.au
website is a collaboration between the DEE and other agencies. This source
provides contemporary energy policy details, including an overview of the
recent ‘A
better energy future for Australia’, which addresses the National Energy
Guarantee.
- An ‘authoritative and official source of energy data for
Australia’ called Australian Energy
Statistics includes reports and time series data that can be downloaded.
- The DEE’s monthly publication, Australian
Petroleum Statistics, provides ‘national and state statistical
information on sales of petroleum products, exports and imports of petroleum
products and crude oil, production of crude oil and condensate, refinery input
and output, and stocks of petroleum products’.
- A range of data is available under ‘Tracking
Australia’s greenhouse gas emissions’,
including a quarterly update on Australia’s greenhouse inventory, state and territory
greenhouse gas inventories, economic sector inventories, greenhouse factors for
industry and greenhouse fact sheets.
- The Department
of Industry, Innovation and Science provides information on Australian
industry, including the mining and resources sectors. There are a number of key
resources, including:
-
information relating to the management of ‘upstream
petroleum’, which ‘includes all petroleum exploration and extraction
activities ... which take place prior to the shipment of stabilised crude oil,
condensate or sales gas’ (including LNG). Key among the activities are the
management of offshore petroleum development through:
- economic analysis through the Office
of the Chief Economist, especially the industry level publications:
Geoscience Australia
(GA) is the key government body responsible for Australian Government
scientific research and advice on geology and geography in Australia. Its
website includes a range of resources and tools relating to energy. Valuable
insight into the future of the energy market can be found under the current and concluded
projects lists. There are a number of useful GA publications:
The Australian
Competition and Consumer Commission (ACCC) provides services in relation to
‘regulated
infrastructure’, in addition to consumer protection and competition
regulation. The Australian Energy Regulator
(AER) is the primary regulatory body.; However, AER staffing, resources and
facilities are provided by the ACCC. The ACCC maintains a regulatory function
in energy
by enforcing competition and consumer protection provisions in energy markets
and assessing energy mergers and authorisations. Between 2015 and 2017 the ACCC
was called on by the Australian Government to make inquiries into the
supply and demand for gas, electricity
supply and prices and the competitiveness
of the East Coast wholesale gas market.
The Department of the Prime Minister and Cabinet (PM&C) holds some
policy coordination functions. In particular, it has a domestic policy focus on
supporting cross-government efforts relating to climate
change, energy productivity and the environment, including
the Paris
Climate Change Agreement and the National
Energy Productivity Plan. In addition, PM&C
hosts the Infrastructure and Project
Financing Agency, which provides advice on
funding and financing nationally significant infrastructure, including in the
energy sector.
The Clean Energy Finance Corporation is a statutory authority established by the Australian
Government to provide specialist clean energy finance, in order to increase the
flow of finance into renewable energy, energy efficiency and low emissions
technologies.
The Clean Energy Regulator administers schemes legislated by the Australian
Government for measuring, managing, reducing or offsetting Australia's carbon
emissions. This includes the National Greenhouse and Energy Reporting Scheme, Emissions
Reduction Fund, Renewable Energy Target and the Australian National Registry of
Emissions Units.
The Australian Renewable Energy Agency aims to accelerate Australia’s shift to renewable energy by
funding projects and sharing knowledge to assist in commercialising renewable
energy technologies.
The Department of
Infrastructure and Regional Development (DIRD) does not have a defined role
in energy generally, but has a range of functions in infrastructure planning,
transport, roads, rail, maritime and regional policy that may influence the
effectiveness of energy infrastructure. More immediately relevant is that
within DIRD the Bureau of Infrastructure,
Transport and Regional Economics (BITRE) publishes an Infrastructure
statistics yearbook, which contains essential infrastructure data on the
energy sector, among others.
From time to time the Productivity Commission (PC) undertakes inquiries and research
into aspects of the energy market. For example, its Shifting
the Dial: 5 year productivity review report included
a chapter on improving
the efficiency of markets, including the energy
sector; and in 2015 the PC delivered a research paper
on Examining
Barriers to More Efficient Gas Markets.
National resources
The Council of Australian
Governments (COAG) Energy
Council governs overall energy market matters. The Energy Council is a ‘Ministerial forum for the Commonwealth, states and
territories and New Zealand, to work together in the pursuit of national energy
reforms’. The website is updated regularly and provides links to the terms
of reference, meeting details and
communiques, priorities, projects and publications. In the context of the National Energy Guarantee
discussion, this is also the location of the Energy
Security Board.
The Australian Energy Market Commission (AEMC) provides market
development advice to government and makes rules for Australian electricity and
gas markets, including the National
Electricity Rules, National
Gas Rules and National
Energy Retail Rules. These rules are made under
the National
Electricity Law, the National
Gas Law and the National
Energy Retail Law. Each year the AEMC publishes
comprehensive details about retail electricity price performance in the
National Electricity Market (NEM), the most recent being the 2016
Residential Electricity Price Trends report.
The Australian Energy Regulator (AER) regulates energy
markets and networks under the national energy market legislation and rules.
This includes monitoring wholesale markets to ensure industry compliance,
taking enforcement actions, setting revenues that network businesses can
recover from networks, and regulating retail energy markets in Queensland, New
South Wales (NSW), South Australia (SA), Tasmania (electricity only) and the Australian
Capital Territory (ACT). A benchmark publication on the energy market, State
of the Energy Market, is released regularly
by AER, and there are frequent update reports
on parts of the market.
The Australian Energy Market Operator (AEMO) is responsible for
the operations of the National
Electricity Market, the interconnected
power system in Australia’s eastern and south-eastern seaboard, parts of the Western
Australian (WA) wholesale electricity network and a
number of components of the gas market across Australia. AEMO produced a
simplified fact
sheet of the operation of the NEM. The following
table outlines the coverage of AEMO in each of the states and territories by
energy type and market function.[1]
WA and Northern Territory (NT) based
resources are outlined under ‘State and territory government resources’ below.
AEMO is a source of real-time and
detailed wholesale pricing data in each of the markets it operates. This
includes:
- the NEM Data
Dashboard, which provides high level within-day price and volume
data, average price tables, operational demand files, a seven-day outlook and a
medium-term outlook
- a visual interpretation of instantaneous dispatch
within the NEM, which is a useful reference to understand market dynamics
(there is also a private sector live infographic of daily generation
information called NEM Watch,
which utilises AEMO dispatch data) and
- details on:
These are not all the data or
reporting undertaken by the AEMO, but they do provide a reasonable overview of
what is happening in the AEMO-covered operations at any one time.
Within the NEM, customers can use
an energy price comparison tool, Energy Made Easy, to assist with provider
selection. This tool is operated by the AER.
The Australian and state and
territory governments have created a joint initiative called the Energy Exchange,
which supports the development and implementation of energy management and
energy efficiency strategies by providing a centralised source of information
targeted at business and commercial users.
State and territory government resources
Generally, all state and territory
governments participate in the Energy Council, as well as operating local
energy market policies and programs. Several states have project work operating
out of their central agencies. This section lists energy market resources at
the state and territory level covering, primarily, policy and regulatory
functions.
New South Wales
The NSW Department of Planning and
Environment manages resources
and energy policy. The Department provides advice
to energy
consumers and the energy
supply industry. Consumer information covers
reducing power bills, consumer protection matters and NSW solar scheme and
metering matters. Supply industry resources are targeted at outlining the
industry segments, accreditations for contestable works, innovation frameworks
and NSW renewable energy matters.
NSW also has an Independent Pricing and Regulatory Tribunal (IPART). IPART states that
it provides independent regulatory decisions and advice to protect the ongoing
interests of the consumers, taxpayers and citizens of NSW. In energy, IPART monitors and reports on the performance and
competitiveness of the retail
electricity and gas markets in NSW; provides guidance
on solar feed-in tariffs; and administers the licences, safety and reliability
of transmission
and distribution networks in NSW. It also conducts
reviews into aspects of electricity supply at the request of the
NSW Government.
Victoria
The Department of Environment,
Land, Water and Planning manages energy
policy. This includes managing Victoria’s renewable
energy targets; and consumer details like energy
affordability, saving on costs and finding a distributor. In addition it advises
on power
outages and emergencies.
The Essential Services Commission (ESC) ‘aims to promote the long term interests of Victorian consumers
with respect to the price, quality and reliability of essential services’. In
relation to energy, it licenses all businesses involved in the supply of electricity and
gas in Victoria and regulates the retail sale of energy (not prices) and the
consumer service standards for energy distribution. The ESC also administers
the Victorian
Energy Efficiency Target, and publishes the Victorian
Energy Market Report.
The Victorian Government also
operates an independent website, Victorian Energy Saver, to assist consumers’
understanding of the energy market.
South Australia
The single entry SA Government portal
provides links to SA energy and
environment policy. This includes consumer
information, industry information, and other environmental matters. SA electricity and gas supply matters are summarised on this site.
The 2017 announcements of SA
energy market investments are mostly contained in the Our Energy Plan document and website. These resources summarise the SA approach to battery
storage, state-owned gas power plants, local power over the national market,
independent energy contracting, SA gas incentives and the SA energy security
target.
The Essential Services Commission of South
Australia (ESCOSA)
is an independent economic regulator, the objective of which is the ‘protection of the long term interests of
South Australian consumers with respect to the price, quality and reliability
of essential services’. ESCOSA outlines its functions under electricity and gas segments. ESCOSA functions include the regulation of feed-in
tariffs; advice on retail prices; administration of energy efficiency schemes;
and licencing, performance monitoring and reporting on generation
(electricity), transmission, distribution and off-grid suppliers in SA.
Tasmania
The Department of State Growth (DSG) is responsible for energy
policy in addition to a range of functions like investment attraction,
transport, infrastructure and tourism. In energy
and resources, DSG works with
the forestry, energy, mining and minerals sectors to achieve growth. In energy, DSG provides policy
advice in areas such as energy markets, regulation, legislation and energy
security. This includes the Tasmanian
Energy Security Taskforce and the Tasmanian
Energy Strategy
The Office of the Tasmanian
Economic Regulator (OTTER) is an independent regulator that aims to protect the long term interests of consumers with
respect to the price, quality and reliability of services by regulating a
number of monopoly, near-monopoly and specified industries within Tasmania,
such as electricity, gas, water and sewerage, taxis and compulsory third party
insurance. In electricity, OTTER regulates security
and reliability of the electricity system, the quality of electricity supplied,
and the prices and conditions of the supply of electricity and related services.
OTTER achieves this by setting a maximum retail price, administering licences,
regulating technical standards, and implementing requirements under Tasmania’s regulatory
framework. In gas, OTTER has similar functions, embedded in laws
and regulations, to administer licences, regulate
technical standards and codes, report on the state of the industry and grant
gas distribution, retail and pipeline licences.
Queensland
The Department of Energy and Water Supply is responsible for energy policy with the aim of reducing cost of living pressures in Queensland through
innovative and efficient energy and water supply services. The functions are
separated for electricity
and renewables and gas. The Department
provides information about a range of issues including Queensland’s renewable
energy policy, affordable energy, rebates and concessions, prices, supply
issues, regulation and safety.
The Queensland Competition Authority (QCA) is an independent
regulator that aims to ensure ‘monopoly businesses operating in Queensland, particularly
in the provision of key infrastructure, do not abuse their market power through
unfair pricing or restrictive access arrangements.’ In electricity regulation, the QCA has dual
functions. First, it provides typical consumer protection functions on prices,
solar feed-in tariffs and related matters. Second, the QCA determines
electricity prices for consumers who are outside
of the de-regulated south east Queensland market, because ‘competition is
limited in the rest of Queensland and most regional and rural consumers
continue to be supplied by Ergon Energy under a standard contract. This is
because Ergon Energy receives a subsidy to ensure that consumers in higher-cost
regional and rural areas pay the same regulated prices as consumers in
lower-cost south east Queensland’. The regulated
regional pricing decisions are published by the QCA.
Western Australia
WA does not participate in the
NEM. Some functions are coordinated through national market bodies; however,
the system is different to that in NEM states. It is useful to understand that
the WA market is different to other Australian markets because:
- WA is generally split into the ‘South
West Interconnected System of Western Australia
(SWIS)’ and non SWIS zones, which determines how market operations and
regulations work
- the WA Wholesale
Electricity Market (WEM) and power system for the SWIS and the retail gas
market in WA are administered by the AEMO and
- the WA Government sets prices for retail electricity for some
consumers in some parts of WA, regulates gas prices for some consumers, and
owns a number of enterprises that generate, distribute and retail energy in WA.
Policy information is diffuse
among WA Government agencies. The Department of Mines, Industry Regulation and
Safety includes EnergySafety, which is responsible for
the technical
and safety regulation of all the electrical and
most of the gas industry in WA, mostly applying to workers in those sectors.
The WA Department of Treasury contains a Public Utilities
Office (PUO), the website which includes
resources on sector reforms, an overview of the WA electricity
industry, gas
industry and electricity
pricing as well as details about solar policy.
The PUO also coordinates energy industry reforms.
The Energy Disputes Arbitrator provides a dispute resolution service between users, or
prospective users, and providers of gas pipeline services and other parties
seeking access to regulated gas pipelines. The Electricity Review
Board can adjudicate some appeals, such as those
against decisions of the WA Economic Regulation Authority (ERA) or WA energy
minister; and make determinations about decisions in the WEM environment.
The WA Economic Regulation
Authority (ERA) is an independent body
that aims to ensure fair, competitive and efficient outcomes from regulated
monopoly businesses for consumers and businesses. It has separate functions for
electricity and gas. In electricity, the ERA approves access
arrangements for network assets, administers
the licensing regime for all parts of the supply
chain, and monitors the behaviour of participants in the wholesale
market. In gas, it regulates access arrangements, administers the licensing
regime across the supply chain and oversees the gas retail market scheme. Finally, the ERA has recently established the WA Rule Change Panel, which was set up under WA regulations to deal with decision-making
functions for changes to the WEM Rules and the Gas Services Information Rules,
in a similar way that the AEMC assesses rules under the NEM.
The ERA does not set energy prices
in WA. Electricity
prices are determined by the WA Government annually as part of the State Budget process. The WA Government
also regulates natural gas prices for small customers in certain
areas.
It is notable that:
- Horizon Power is a
government-owned enterprise that generates, distributes and retails electricity
outside of the SWIS, covering areas such as the Pilbara, Kimberley, Gascoyne,
Mid-West and the southern region of WA that includes the Southern Goldfields,
Esperance, Hopetoun and Norseman
- Western Power is a
government-owned enterprise that provides transmission and distribution
services to WA and
- Synergy Energy is
a government-owned enterprise that generates and sells electricity (and gas) to
the SWIS. It also offers wholesale services under certain conditions.
Australian Capital Territory
The Environment, Planning and Sustainable
Development Directorate (EPSDD) is responsible for energy policy in the ACT. The main areas of focus are ‘reliable
and affordable energy’, ‘smarter
use of energy’, ‘cleaner energy’ and ‘growth
in the clean economy’. It addresses these through
programs that invest in renewable energy sources and efficiency programs like ‘Actsmart’.
EPSDD is also the Technical
Regulator of utilities services in the ACT, the
role of which is to ‘ensure safe and reliable gas, electricity and water services
to the community’.
The Independent Competition and Regulatory
Commission (ICRC)
regulates prices, access to infrastructure services and matters in relation to
regulated industries; and investigates competitive neutrality complaints and
government-regulated activities. In relation to energy, the ICRC licenses distributors, monitors compliance with
licence conditions and regulatory obligations, and determines a range of
matters such as industry codes, regulatory cost recovery under an ‘energy
industry levy’ and (when requested) electricity prices in their coverage area.
Northern Territory
The NT does not participate in the
NEM market functions. It does utilise the AER for aspects of network
regulation. However, there are slightly different resources for the NT energy
sector.
Primary policy functions for
energy sit with the Department of
Primary Industries and Resources (DPIR). The DPIR states that it brings together key functions
that drive economic development on NT lands, coastal areas and waterways, with
a focus on livestock, horticulture, fisheries, mining and energy. There is no single point on energy, but the resources
cover a range of geoscience and mining functions, and include publications,
information and statistics on mining and energy.
In addition, the Department of Treasury and Finance provides resources on utilities
reform, covering significant reforms to
electricity markets and assets.
The Utilities Commission (UC) is an independent
industry regulator, established
to oversee regulated industries for the ‘promotion
and safeguard of competition and fair and efficient market conduct or, in the
absence of a competitive market, the simulation of competitive market conduct
and the prevention of the misuse of monopoly power’. In electricity, the UC covers market administration, conduct performance, pricing and technical regulation. This covers issues such as licensing; disputes
and compliance monitoring; approval and/or enforcement of codes and rules aimed
at ensuring appropriate behaviour and conduct by licensed or regulated entities;
service levels and performance indicators across the supply chain; and
enforcing technical regulations. Pricing regulation is most complicated as the
UC creates regulated prices for retail customers consuming less than 750 megawatt hours per year,
monitors ‘power
system control and ancillary charges’ and provides
some regulation of generation
pricing (in particular ‘prices oversight of Power
and Water Corporation’s generation business by the Commission for as long as
that business is not subject to competition or the tangible threat of
competition’).
It is notable that:
- the NT Power and Water
Corporation is a government-owned enterprise that is responsible for
electricity transmission and distribution across the NT, and operates a small retail
business
- Territory Generation
is a government-owned enterprise that produces electricity for the NT and
- Jacana Energy is a
government-owned entity that is one of the retailers of electricity in the NT.
National groups and bodies
There are a number of bodies that have
a primary focus on energy, representing various parts of the market from
generation to consumption. Some of the larger national bodies are described
below. Other bodies may exist at a state level, and some groups talk about
energy without a primary energy market focus. Those groups are not outlined
below, nor are suppliers and participants in the market.
Energy
Consumers Australia (ECA) is a consumer advocacy group created by COAG that works
to promote the long-term interests of residential and small business energy
consumers with respect to price, quality, safety, reliability and security. The
ECA provides a useful summary of survey data on small and medium enterprise
retail tariffs, the most recent for October
2017.
Energy Networks
Australia (ENA)
is the national industry association
representing Australian electricity networks and gas distribution businesses.
ENA states that it has 25 electricity and gas network companies as
members and that it provides ‘governments, policy-makers and the community with
a single point of reference for major energy network issues in Australia’. ENA makes
available a range of publications including submissions, briefings, fact sheets and industry
guidelines. It is also collaborating with the CSIRO to implement an Electricity
Network Transformation Roadmap.
The Australian Energy Council (AEC) represents 21 electricity and
natural gas businesses operating in the wholesale
and retail energy markets that claim to generate the majority of electricity in
Australia and sell gas and electricity to over 10 million homes and businesses.
The AEC brought together functions from previously separate bodies, including
the Energy Supply Association of Australia, an
earlier Energy Networks Association and the Energy Retailers Association of
Australia. The group publishes a range of analysis, news
updates and media releases, reports and submissions made through various fora on its website.
The Australian Petroleum Production &
Exploration Association (APPEA) is the peak body representing Australia’s oil and gas
exploration and production industry, has about 60 full member companies and claims
that these members account for an estimated 98 per cent of the nation’s
petroleum production. APPEA updates stakeholders through its news and media page, which includes industry publications.
The Australian Pipelines and Gas Association (APGA) is a peak body representing Australasia’s
pipeline infrastructure, with a focus on gas
transmission, but also including transportation of other products, such as oil,
water and slurry. The APGA membership includes constructors, owners, operators,
advisers, engineering companies and suppliers of pipeline products and services.
APGA publishes ‘facts
and figures’ on pipeline issues and supports the Major
Pipelines of Australia map.
The Clean Energy Council (CEC) is the peak body representing
the clean energy industry in Australia. It claims to represent hundreds of businesses operating in solar,
wind, energy efficiency, hydro, bioenergy, energy storage, geothermal and
marine along with more than 4000 solar installers. The CEC publishes many of its
views and positions on the ‘Policy and
advocacy’ page of
its website.
Major Energy Users
Inc (MEU) is an advocacy group
for large users of energy and it provides input into all aspects of the energy
markets, including to federal and state and territory governments and the
energy market institutions of AEMC, AER, AEMO, the WA ERA, and the NT Utilities
Commission. There were 22
members listed on the website as at
November 2017. In June 2017 the MEU made a submission to the ACCC’s inquiry into electricity supply and prices that outlines the major
user issues in the energy sector.
The Australian Photovoltaics Institute (APVI) is a national body
that comprises companies, agencies, individuals and academics with an interest
in solar energy research, technology, manufacturing, systems, policies,
programs and projects. The APVI aims to use research, analysis and information
to increase the use of PV. One of the APVI’s projects is a user-friendly Solar PV Maps and Tools site. The data and information includes, for example, live solar
generation, PV performance by
climate region and installations data.
The Energy Efficiency Council (EEC) is a peak body for
energy efficiency, co-generation and demand management that exists ‘to make
sensible, cost effective energy efficiency measures standard practice across
the Australian economy’. The EEC claims to have 70 members for which it works to promote stable
government policy, provide clear information to energy users and drive quality
of energy efficiency products and services. It has published a number of
papers, including the Energy
Efficiency Policy Handbook, a guide to policies for energy efficiency improvements in
Australia.
Major international resources
There are numerous resources on the markets of individual
countries, and a number of global industry bodies. The following resources may
assist in placing Australia in an international context:
- The International Energy Agency
(IEA) works for 29 member countries on the four main topics of energy security,
economic development, environmental awareness and worldwide engagement. A major
resource from the IEA is the World Energy
Outlook.
- The multinational petroleum corporation BP publishes a regular Statistical
Review of World Energy, including data and commentary on global energy
markets. This resource helps in understanding major global energy market
trends.
[1]. The Northern Territory is not currently connected to the NEM or the Eastern
gas market, and maintains independent regulatory authority through the NT
Utilities Commission.
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