Department/Agency
Department of Industry, Science, Energy and Resources
Topic
Industry
Announcement date
2/12/2021
Announcement
https://www.legislation.gov.au/Details/F2021L01708
Problem being addressed
Concerns around electricity prices and reliability were investigated as part of the Australian Competition and Consumer Commission’s (ACCC) Retail Electricity Pricing Inquiry, which found competition in the wholesale market was not working as well as it could, detrimentally affecting electricity affordability. A series of reforms were recommended.
Proposal
On 2 December 2021, the Australian Government introduced legislation to give effect to the Underwriting New Generation Investments Program.
The Underwriting New Generation Investments (UNGI) program is intended as an interim measure to reduce barriers to entry for new firm generation in the energy sector in the medium-term. The objectives of UNGI are to enable commercial and industrial customers and smaller retailers to access affordable energy supply arrangements, to increase competition and supply to reduce wholesale electricity prices and to improve reliability and system security across the National Electricity Market (NEM) by increasing the level of firm capacity in the system.
The former Department of the Environment and Energy prepared and certified a Regulation Impact Statement (RIS), which the Office of Best Practice Regulation (OBPR) assessed as consistent with best practice on 24 September 2019.
The RIS estimates the average annual regulatory costs at $1.02m.
Readers should be aware that the RIS was prepared using the best available information at the time of drafting and that some costs, benefits, energy market analysis and discussion of government policy highlighted in the document may have changed since the RIS was finalised. The Department of Industry, Science, Energy and Resources has prepared an addendum document to the RIS setting out the extent of those changes. The Office of Best Practice Regulation has not assessed the addendum against the Australian Government’s Regulatory Impact Analysis framework.
Assessed RIS outcome
Compliant with RIS requirements.