Part 1 Preliminary
1 Name of Regulation
This Regulation is the Electricity Infrastructure Investment Regulation 2021.
2 Commencement
This Regulation commences on the day on which it is published on the NSW legislation website.
3 Definitions
In this Regulation—advocate means the electricity infrastructure jobs advocate.appointed member means a member of the Board appointed by the Minister under section 7(2)(a) or (c) of the Act.basis risk, for Part 5—see clause 22.Board means the board for manufacturing and construction in the NSW renewable energy sector established under section 7 of the Act.development pathway means the development pathway referred to in the Act, section 45(1)(a).infrastructure investment objectives report means a report prepared by the consumer trustee under the Act, section 45(1).fixed shape, fixed volume derivative arrangement, for Part 5—see clause 22.joint chairperson means either of the 2 members appointed as the joint chairperson of the Board under section 7(3) of the Act.member means any member of the Board.non-financial value criteria, for an LTES agreement, means matters that are not directly related to the financial value of the LTES agreement, including the following—(a) the use of land,(b) community engagement activities undertaken by the LTES operator,(c) how the LTES operator will share with the local community the benefits of the construction and operation of infrastructure under the LTES agreement,(d) regional economic development in New South Wales.NSW region, for Part 5—see clause 22.plan has the same meaning as in Part 2 of the Act.the Act means the Electricity Infrastructure Investment Act 2020.Note—The Act and the Interpretation Act 1987 contain definitions and other provisions that affect the interpretation and application of this Regulation.cl 3: Am 2021 (525), Sch 1[1]; 2021 (659), Sch 1[1]; 2022 (145), Sch 1[1]; 2022 (366), Sch 1[1] [2].
Part 2 NSW renewable energy sector board and electricity infrastructure jobs advocate
pt 2, hdg: Am 2021 (525), Sch 1[2].
Division 1 The Board—the Act, s 7(7)
pt 2, div 1, hdg: Ins 2021 (525), Sch 1[3].
4 Functions of Board
(1) The Board may advise the Minister on any matter to which a plan may relate.(2) The Board must review a plan under section 7(4)(b) of the Act at least once every 2 years after the plan is approved by the Minister.
5 Objectives of plan
For the purposes of section 8(1)(d) of the Act, the following objectives are prescribed—(a) to protect the financial interests of NSW electricity customers,(b) to be consistent with Australia’s international trade obligations.
6 Term of office
(1) An appointed member holds office for a term of 3 years and may be re-appointed.(2) A person may not be appointed as an appointed member for more than 9 years in total, whether or not consecutively.
7 Members and procedures of the Board
Schedule 1 contains provisions relating to the members and procedures of the Board.
Division 2 The advocate—the Act, s 11(5)
pt 2, div 2, hdg: Ins 2021 (525), Sch 1[4].
8 Employment and remuneration
(1) The office of the advocate is a statutory office and the provisions of the Government Sector Employment Act 2013 relating to the employment of Public Service employees do not apply to the office, except as provided by this clause.(2) The following provisions of, or made under, the Government Sector Employment Act 2013 relating to the employment of Public Service senior executives apply to the advocate—(a) provisions relating to the band in which an executive will be employed,(b) provisions relating to the contract of employment of an executive,(c) provisions relating to the remuneration, employment benefits and allowances of an executive,(d) provisions relating to the termination of employment of an executive.(3) For the purposes of applying the provisions of the Government Sector Employment Act 2013 to the advocate under subclause (2), a reference to the employer of a Public Service senior executive is taken to be a reference to the Minister.cl 8: Ins 2021 (381), cl 3. Renumbered as cl 17, 2021 (525), Sch 1[6]. Ins 2021 (525), Sch 1[4].
9 Vacancy in office
The office of the advocate becomes vacant if the advocate—(a) dies, or(b) completes a term of office and is not re-appointed, or(c) resigns from the office by written instrument to the Minister, or(d) is removed from office, orNote—The advocate may be removed under the Government Sector Employment Act 2013, section 41 or Part 6.(e) becomes bankrupt or insolvent, applies to take the benefit of a law for the relief of bankrupt or insolvent debtors, compounds with creditors or makes an assignment of the advocate’s remuneration for the creditors’ benefit, or(f) becomes a mentally incapacitated person, or(g) is convicted in New South Wales of an offence punishable by imprisonment for 12 months or more, or(h) is convicted outside of New South Wales of an offence that, if committed in New South Wales, would be punishable by imprisonment for 12 months or more.cl 9: Ins 2021 (525), Sch 1[4].
10 Disclosure of pecuniary and other interests
(1) This clause applies if—(a) the advocate has a direct or indirect pecuniary or other interest in a matter about which the advocate is advising, or is about to advise, the Minister, and(b) the interest appears to raise a conflict with the proper performance of the advocate’s duties in relation to advising on the matter.(2) For the purposes of subclause (1), the advocate is not taken to have a pecuniary or other interest if the interest is so remote or insignificant that it could not reasonably be regarded as likely to influence the advice the advocate might give to the Minister.(3) The advocate must, as soon as possible after the relevant facts have come to the advocate’s knowledge, disclose the nature of the interest to the Minister.(4) It is sufficient disclosure of the nature of an interest relating to a specified company, body or person that arises after the date of the disclosure if the advocate has disclosed that the advocate—(a) is a member, or is in the employment, of the company or other body, or(b) is a partner, or is in the employment, of the person, or(c) has some other specified interest relating to the company, body or person.(5) If a disclosure made under this clause relates to a matter about which the advocate is advising, particulars of the disclosure must be included in the advice to the Minister about the matter.cl 10: Ins 2021 (525), Sch 1[4].
11 Code of conduct
The Minister may issue a code of conduct for the advocate.cl 11: Ins 2021 (525), Sch 1[4].pt 2A: Ins 2021 (525), Sch 1[5]. Renumbered as Part 3, 2022 (366), Sch 1[3].
Part 3 Energy security targets
pt 3 (previously Part 2A): Renumbered 2022 (366), Sch 1[3].
pt 3: Ins 2021 (381), cl 3. Renumbered as Part 7, 2022 (366), Sch 1[14].
12 Interpretation
Words used in this Part have the same meaning as in the National Electricity Rules.cl 12: Ins 2021 (525), Sch 1[5].
13 Calculating maximum demand—the Act, s 12(3)
(1) In calculating the maximum demand for a financial year, the energy security target monitor must—(a) take into account the most recent forecast of maximum demand for sent out generation in New South Wales in summer, as published by AEMO, and(b) adjust the forecast to reflect the maximum demand as generated by generating units in New South Wales in summer.(2) In calculating the maximum demand for a financial year, the energy security target monitor must also take into account the forecast of use of distributed energy resources in New South Wales in the financial year, as specified in the most recent statement of opportunities.(2A) In calculating the maximum demand for a financial year, the energy security target monitor may take into account major constraints on transmission infrastructure across different sub-regions of New South Wales, as specified in the most recent—(a) Inputs, Assumptions and Scenarios Report, and(b) ISP methodology.(3) In this clause—distributed energy resource means a device, not directly connected to network infrastructure, that can generate or store electricity.cl 13: Ins 2021 (525), Sch 1[5]. Am 2021 (659), Sch 1[2].
14 Calculating firm capacity—the Act, Dictionary, definition of “firm capacity”
(1) In calculating the firm capacity for a financial year, the energy security target monitor must take into account the following capacity—(a) the capacity of scheduled generating units in New South Wales in the summer of the financial year,(b) the capacity of semi-scheduled generating units in New South Wales in the summer of the financial year,(c) the capacity of non-scheduled generating units in New South Wales, as the energy security target monitor considers appropriate,(d) the capacity of interconnectors in New South Wales, operating under normal conditions,(e) the capacity from demand response, other than capacity expected to be available under the reliability and emergency reserve trader.(2) In calculating the firm capacity for a financial year, the energy security target monitor must also take into account the capacity of the following if, in the energy security target monitor’s opinion, the capacity is likely to be available to NSW electricity customers in the financial year—(a) generating units listed, at the time of the calculation, as existing or committed on the generation information page,(b) generating units that will be constructed and operated under an LTES agreement,(c) generating units that will be constructed under funding programs run by, or on behalf of, a NSW or Commonwealth government agency,(d) interconnectors for which a revenue determination has been made under rule 6A.4 of the National Electricity Rules,(e) interconnectors for which a determination has been made under the Act, section 38,(f) interconnectors under a priority transmission infrastructure project to which a direction under the Act, section 32(1)(b) relates.(3) In calculating the firm capacity for a financial year, the energy security target monitor must also take into account information about demand side participation, as specified in the most recent statement of opportunities.cl 14: Ins 2021 (525), Sch 1[5].
15 Additional information for calculating firm capacity—the Act, Dictionary, definition of “firm capacity”
(1) In calculating the capacity of generating units for the purposes of clause 14, the energy security target monitor must take into account information on the generation information page.(2) In calculating the capacity of semi-scheduled generating units and non-scheduled generating units for the purposes of clause 14, the energy security target monitor must take into account—(a) information about the amount of electricity produced, at times of peak demand in summer over the past three financial years, by generating units that use variable renewable energy sources, for example, the sun, waves and wind, and(b) based on the information in paragraph (a)—the amount of electricity likely to be produced, at times of peak demand in summer in the financial year, by generating units that use each variable renewable energy source.(3) In calculating the capacity of interconnectors for the purposes of clause 14, the energy security target monitor must take into account information about interconnectors operating under normal conditions, as specified in the most recent—(a) Inputs, Assumptions and Scenarios Report, and(b) ISP methodology.(4) In calculating the firm capacity for a financial year for the purposes of clause 14, the energy security target monitor may take into account major constraints on transmission infrastructure across different sub-regions of New South Wales, as specified in the most recent—(a) Inputs, Assumptions and Scenarios Report, and(b) ISP methodology.cl 15: Ins 2021 (525), Sch 1[5]. Am 2021 (659), Sch 1[3].
16 Energy security target monitor reports—the Act, s 13
(1) In preparing a report under the Act, section 13(1), the energy security target monitor must take into account each scenario and the sensitivities relating to each scenario, as specified in the most recent statement of opportunities, to the extent they relate to New South Wales.(2) The report must include the following for each scenario and the sensitivities relating to each scenario, to the extent they relate to New South Wales—(a) the energy security target monitor’s forecast of variations to—(i) the maximum demand, and(ii) the firm capacity, and(iii) any target breach,(b) an analysis of the factors that might affect the forecast of variations to a target breach, for example, whether generating units that are being constructed or have been committed will be constructed on time.cl 16: Ins 2021 (525), Sch 1[5].pt 2B: Ins 2021 (659), Sch 1[4]. Renumbered as Part 5, 2022 (366), Sch 1[5].cl 16AA: Ins 2022 (145), Sch 1[2]. Am 2022 (366), Sch 1[6]. Renumbered as cl 22, 2022 (366), Sch 1[7].cl 16A: Ins 2021 (659), Sch 1[4]. Renumbered as cl 23, 2022 (366), Sch 1[7].cl 16B: Ins 2021 (659), Sch 1[4]. Renumbered as cl 24, 2022 (366), Sch 1[7].cl 16C: Ins 2021 (659), Sch 1[4]. Renumbered as cl 25, 2022 (366), Sch 1[7].cl 16D: Ins 2021 (659), Sch 1[4]. Am 2022 (145), Sch 1[3]. Renumbered as cl 26, 2022 (366), Sch 1[7].cl 16E: Ins 2021 (659), Sch 1[4]. Subst 2022 (145), Sch 1[4]. Renumbered as cl 31, 2022 (366), Sch 1[9].cl 16F: Ins 2022 (145), Sch 1[4]. Renumbered as cl 32, 2022 (366), Sch 1[9].cl 16G: Ins 2022 (145), Sch 1[4]. Renumbered as cl 33, 2022 (366), Sch 1[9].pt 2C: Ins 2022 (145), Sch 1[5]. Renumbered as Part 6, 2022 (366), Sch 1[10].cl 16H: Ins 2022 (145), Sch 1[5]. Renumbered as cl 34, 2022 (366), Sch 1[11].cl 16I: Ins 2022 (145), Sch 1[5]. Renumbered as cl 35, 2022 (366), Sch 1[11].cl 16J: Ins 2022 (145), Sch 1[5]. Renumbered as cl 38, 2022 (366), Sch 1[13].cl 16K: Ins 2022 (145), Sch 1[5]. Renumbered as cl 39, 2022 (366), Sch 1[13].
Part 4 Network infrastructure projects
pt 4: Ins 2022 (366), Sch 1[4].
17 Classes of network infrastructure
For the Act, Dictionary, definition of REZ network infrastructure project, paragraph (b), the classes of network infrastructure are as follows—(a) class 1—transmission assets within the meaning of the National Electricity Rules,(b) class 2—distribution assets within the meaning of the National Electricity Rules,(c) class 3—network infrastructure that is—(i) not owned or controlled by a network operator, and(ii) used to provide network services within the meaning of the National Electricity Rules,(d) class 4—network infrastructure that—(i) provides for the continuous and safe scheduling, operation and control of the power system within the meaning of the National Electricity Rules, and(ii) is not class 1 or 2.cl 17 (previously cl 8): Renumbered 2021 (525), Sch 1[6]. Renumbered as cl 40, 2022 (366), Sch 1[14].cl 17: Ins 2022 (366), Sch 1[4].
18 Consumer trustee may give advice and recommendations about network infrastructure projects—the Act, s 60(4)(c)
(1) The consumer trustee may, on the request of a relevant person, give the relevant person advice about a network infrastructure project.(2) The consumer trustee may also give the advice to other relevant persons.(3) In this clause—relevant person means the following—(a) the Minister,(b) the infrastructure planner,(c) the Energy Corporation.cl 18: Ins 2021 (659), Sch 1[5]. Renumbered as cl 41, 2022 (366), Sch 1[14].cl 18: Ins 2022 (366), Sch 1[4].
19 Recommendations by consumer trustee about network infrastructure projects—the Act, s 66(5)(d)
The consumer trustee must not make a recommendation under the Act, section 31(1)(a) that the Minister give a direction under the Act, section 32 unless the consumer trustee is satisfied the direction is reasonably necessary to achieve the infrastructure investment objectives.cl 19: Ins 2021 (659), Sch 1[5]. Renumbered as cl 42, 2022 (366), Sch 1[14].cl 19: Ins 2022 (366), Sch 1[4].
20 Directions to carry out network infrastructure projects—the Act, s 32(2)(f)
(1) A direction given by the Minister under the Act, section 32 must—(a) specify the grounds on which the Minister is satisfied giving the direction is consistent with the objects of the Act, and(b) contain other matters the Minister considers relevant.(2) A direction given by the Minister under the Act, section 32 that a network operator carry out a REZ network infrastructure project must also specify—(a) the class of the network infrastructure as specified in clause 17, and(b) the technical specifications for the network infrastructure project set out in a recommendation by the infrastructure planner to the consumer trustee under the Act, section 30.cl 20: Ins 2022 (366), Sch 1[4].
21 Transfer of network infrastructure—the Act, s 42
(1) A person (the transferee) to whom network infrastructure is transferred is taken to be a network operator to whom the Act, Part 5, Division 3 applies if—(a) the network infrastructure is transferred from a network operator (the transferor), and(b) the transferor is subject to an authorisation in relation to the network infrastructure, and(c) the authorisation provider approves the transferee being taken to be a network operator to whom the Act, Part 5, Division 3 applies.(2) If the Energy Corporation is the infrastructure planner in relation to the transferred network infrastructure—(a) the Energy Corporation may make a recommendation to the authorisation provider in relation to whether to give approval under subclause (1)(c), and(b) the authorisation provider must consider the Energy Corporation’s recommendation before giving approval.(3) On the approval of the authorisation provider, a determination under the Act, section 38 that, immediately before the approval, applied to the transferor, is taken to apply to the transferee.(4) To avoid doubt, the transferee is not entitled to receive amounts paid to the transferor by the scheme financial vehicle before the transfer.(5) In this clause—has the same meaning as in the Act, section 36.means—(a) for an authorisation referred to in the Act, section 36(4), definition of , paragraph (a)—the consumer trustee, and(b) for an authorisation referred to in the Act, section 36(4), definition of , paragraph (b) or (c)—the Minister.cl 21: Ins 2022 (366), Sch 1[4].
Part 5 Electricity infrastructure investment safeguard—the Act, Part 6
pt 5 (previously Part 2B): Renumbered 2022 (366), Sch 1[5].
22 Definitions
In this Part—basis risk means the risk arising from differences in the variables between LTES agreements and risk management contracts, including price, volume and timing.fixed shape, fixed volume derivative arrangement means a derivative arrangement in which—(a) the amount paid by an LTES operator or the scheme financial vehicle on the exercise of an option is the difference between—(i) the regional reference price in the wholesale electricity market, and(ii) the fixed price for electricity under the LTES agreement, settled against the delivery of specified amounts of electricity at specified times of day, and(b) the LTES operator has financial exposure to the wholesale electricity market.NSW region means the region identified as the New South Wales region in the Regions Publication, published by AEMO under the National Electricity Rules, clause 2A.1.3.cl 22 (previously cl 16AA): Renumbered 2022 (366), Sch 1[7].
23 Reliability standard—the Act, s 43
For the purposes of the Act, section 43, definition of reliability standard, the following are prescribed—(a) until 30 June 2025—the interim reliability measure specified in the National Electricity Rules, clause 3.9.3C(a1),(b) from 1 July 2025—the reliability standard specified in the National Electricity Rules, clause 3.9.3C(a).cl 23 (previously cl 16A): Renumbered 2022 (366), Sch 1[7].
24 Content of infrastructure investment objective reports by consumer trustee—the Act, s 45
(1) An infrastructure investment objectives report must contain the following—(a) how the infrastructure required under the development pathway specified in the report will assist in achieving the infrastructure investment objectives,(b) information about the expected timing, staging and sequencing of the construction of—(i) the infrastructure required under the development pathway, and(ii) REZ network infrastructure projects that may be required,(c) a comparative assessment of the merits of constructing long-duration storage infrastructure that exceeds the minimum objective specified in the Act, section 44(3)(b) and firming infrastructure to meet the reliability standard,(d) a forecast of wholesale electricity costs and costs for NSW electricity customers that are due to contributions required to be paid by distribution network service providers under the Act, section 58,(e) details of the current, planned and expected construction and operation of infrastructure for the supply of electricity in New South Wales and the national electricity market,(f) an analysis, including the methodology, of the risks to NSW electricity customers of early or delayed investment in infrastructure to which the Act, Part 6 applies,(g) an estimate of the amount of electricity in gigawatt hours that is equivalent to the gigawatts of capacity required under the minimum objectives specified in the Act, section 44(3), using information in the 2020 Integrated System Plan published by AEMO under the National Electricity Rules.(2) An infrastructure investment objectives report, other than the first report prepared under the Act, section 45(2)(a), must also contain the following—(a) a description of the changes since the previous report to—(i) the development pathway, and(ii) the plan for competitive tenders under the Act, section 45(1)(b),(b) the outcomes of tenders carried out since the previous report, including—(i) the number of persons who made a bid in each tender, including the number of eligible and ineligible bids according to the rules made under the Act, section 47(5), and(ii) the number of LTES agreements recommended by the consumer trustee after each tender, and(iii) the number of LTES agreements entered into,(c) details of the infrastructure constructed, or proposed to be constructed, under LTES agreements entered into, or agreed to be entered into, since the previous report,(d) an assessment of the progress in achieving the minimum objectives specified in the Act, section 44(3),(e) an assessment of the resilience of the NSW electricity system in relation to lulls in variable renewable energy sources, as it relates to the development pathway in the report, including by reference to climate modelling.cl 24 (previously cl 16B): Renumbered 2022 (366), Sch 1[7].
25 Preparation of infrastructure investment objectives reports—the Act, s 45(4)
(1) The consumer trustee must take the following into account in preparing an infrastructure investment objectives report—(a) any target breaches identified in the most recent energy security target monitor report,(b) the forecast of unserved energy from the most recent statement of opportunities published by AEMO under the National Electricity Rules,(c) the most recent Integrated System Plan published by AEMO under the National Electricity Rules,(d) market conditions, including supply chains and labour and capital constraints,(e) the payments required to be made by the scheme financial vehicle under existing and planned LTES agreements,(f) how the development pathway in the infrastructure investment objectives report will contribute to the object of the Act, specified in the Act, section 3(1)(a),(g) the resilience of the NSW electricity system in relation to lulls in variable renewable energy sources, including by reference to climate modelling.(2) Subclause (1)(g) does not apply to the first infrastructure investment objectives report prepared under the Act, section 45(2)(a).(3) When preparing the development pathway for an infrastructure investment objectives report, the consumer trustee must—(a) take into account several scenarios for the construction of generation, long-duration storage and firming infrastructure in New South Wales, and(b) analyse the resilience of the outcomes for each scenario, including in relation to—(i) the reliability of supply, and(ii) the financial exposure risks to NSW electricity customers.(4) This clause does not limit the matters the consumer trustee may take into account in preparing an infrastructure investment objectives report.cl 25 (previously cl 16C): Renumbered 2022 (366), Sch 1[7].
26 Tendering for LTES agreements—the Act, s 47(3)(a)
(1) The consumer trustee must conduct a competitive tender in a way that—(a) encourages genuine competition between the persons making tender bids, and(b) encourages competition between market participants, and(c) encourages tender bids from persons who are not already parties to LTES agreements, and(d) is transparent, open and fair for all persons making tender bids.(2) Subclause (1)(d) does not require the consumer trustee to disclose information the consumer trustee considers confidential or commercially sensitive.(2A) Before conducting a competitive tender involving an LTES agreement for the construction and operation of generation infrastructure that includes an option to exercise a derivative arrangement that is not a fixed shape, fixed volume derivative arrangement, the consumer trustee must be satisfied that—(a) the arrangement is in the long-term financial interests of NSW electricity customers, and(b) the arrangement allows for the reasonable forecasting of financial impacts to NSW electricity customers, including impacts arising from the volume of electricity produced by the LTES operator throughout the day and over the term of the agreement, and(c) the risks, including the basis risk, associated with the arrangement can be managed under the risk management framework.(3) When conducting a competitive tender, the consumer trustee must consider recent trends and changes in the following—(a) electricity infrastructure technology,(b) the national electricity market,(c) the behaviour of customers and market participants.(4) The assessment of the financial value of a tender bid must consider the effect of the infrastructure proposed to be constructed and operated under an LTES agreement on the following—(a) wholesale electricity costs,(b) the costs of network infrastructure, including REZ network infrastructure projects, required to support the infrastructure that will be constructed and operated under the LTES agreement,(c) the costs of other services associated with power system security,(d) the payments that will be required to be made by the scheme financial vehicle under LTES agreements,(e) other matters the consumer trustee considers relevant.(5) The consumer trustee must—(a) ensure the costs to the consumer trustee of carrying out a competitive tender are reasonable, and(b) minimise the costs of making a tender bid for the persons making tender bids.(6) In this clause—market participant has the same meaning as in the National Electricity Rules.power system security has the same meaning as in the National Electricity (NSW) Law.cl 26 (previously cl 16D): Renumbered 2022 (366), Sch 1[7].
27 Notice of proposal to exercise option under LTES agreement
The minimum notice period for the Act, section 46(2)(d) is 6 months before the exercise of the option.cl 27: Ins 2022 (366), Sch 1[8].
28 Competitive tenders for LTES agreements—the Act, s 47(3)(a)
(1) A person may not make a tender bid in a competitive tender for an LTES agreement for infrastructure if—(a) the infrastructure is not connected, or proposed to be connected, to network infrastructure in the NSW region, or(b) an access right for the infrastructure has already been conferred on the person under an access scheme.(2) Subclause (1)(b) does not apply if the consumer trustee is satisfied there are exceptional circumstances.(3) In this clause—exceptional circumstances means circumstances specified by the consumer trustee before conducting the competitive tender.cl 28: Ins 2022 (366), Sch 1[8].
29 Tender rules
(1) Rules made under the Act, section 47(5) dealing with eligibility criteria for making a tender bid for generation infrastructure or long-duration storage infrastructure must not restrict—(a) the location in the NSW region in which the infrastructure may be constructed or operated, or(b) the type of technology or fuel that may be used to construct or operate the infrastructure.(2) Rules made under the Act, section 47(5) may provide for the matters specified in subclause (1) to be considered in the assessment of a tender bid.(3) For the Act, section 47(5)(g), the rules must deal with the assessment of a tender bid against the non-financial value criteria for LTES agreements.cl 29: Ins 2022 (366), Sch 1[8].
30 Recommendations about LTES agreements
(1) The consumer trustee may include the following information in a recommendation to the scheme financial vehicle under the Act, section 48—(a) information obtained or produced during a competitive tender process,(b) information obtained or produced during the consumer trustee’s assessment of a tender bid, including information obtained or produced by a person acting at the direction of the consumer trustee.(2) Subclause (1)(b) applies only if the information was obtained or produced for the benefit of the consumer trustee and the scheme financial vehicle.(3) When making a recommendation about an LTES agreement, the consumer trustee must take into account the non-financial value criteria for LTES agreements.cl 30: Ins 2022 (366), Sch 1[8].
31 LTES agreement for generation infrastructure—the Act, s 46(2)(f)
An LTES agreement for the construction and operation of generation infrastructure must give the LTES operator an option to exercise a derivative arrangement that—(a) is a fixed shape, fixed volume derivative arrangement, or(b) is a kind of arrangement the consumer trustee is satisfied—(i) is in the long-term financial interests of NSW electricity customers, and(ii) allows for the reasonable forecasting of financial impacts to NSW electricity customers, including impacts arising from the volume of electricity produced by the LTES operator throughout the day and over the term of the agreement, and(iii) has risks, including basis risk, that can be managed under the risk management framework.cl 31 (previously cl 16E): Renumbered 2022 (366), Sch 1[9].
32 Risk management framework—the Act, s 51(8)
(1) A risk management framework must mitigate the following risks—(a) the risk that the cash balance of the Fund will not be sufficient to make the payments specified in the Act, section 55(b),(b) the risk to the financial interests of NSW electricity customers of unexpected or significant increases in liabilities for payments by the scheme financial vehicle under LTES agreements from year to year,(c) the risk of a reduction in the liquidity of the wholesale electricity market, excluding the spot market within the meaning of the National Electricity Rules, if options under LTES agreements are exercised,(d) the risk that significant increases to contribution determinations under the Act, section 56 will be required to maintain a prudent cash balance for the Fund,(e) the basis risk to the scheme financial vehicle.(2) A risk management framework must also—(a) include information about how the consumer trustee will implement the framework, including details of policies and guidelines to be developed by the consumer trustee, and(b) provide for a cap on the basis risk to the scheme financial vehicle aggregated across all risk management contracts, and(c) provide for the scheme financial vehicle to enter into risk management contracts to mitigate the risks specified in the framework, and(d) require the scheme financial vehicle to demonstrate to the consumer trustee how the basis risk arising from a risk management contract that is a derivative arrangement will be managed, and(e) set out the requirements for the scheme financial vehicle to report to the consumer trustee about—(i) the overall performance of the framework, and(ii) breaches of the framework and risk management contracts.(3) If a risk management contract provided for by the risk management framework is a derivative arrangement, the scheme financial vehicle must not enter into the contract unless satisfied that entering into the contract—(a) is a reasonable and appropriate way to mitigate a risk specified in the framework, and(b) is in the long-term financial interests of NSW electricity customers, and(c) will not result in the scheme financial vehicle exceeding the cap on basis risk provided for by the framework.(4) A risk management contract entered into by the scheme financial vehicle under the risk management framework may, but is not required to, include loans or repayable grants to the scheme financial vehicle.(5) To avoid doubt, subclause (1) does not limit the risks, and in particular the risks to the financial interests of NSW electricity customers, that may be addressed by a risk management framework.cl 32 (previously cl 16F): Renumbered 2022 (366), Sch 1[9].
33 Renewal or extension of risk management contract—the Act, s 52(3)
A risk management contract may not be renewed or extended if, at the time of the renewal or extension, the risk management framework does not permit the scheme financial vehicle to enter into the contract.cl 33 (previously cl 16G): Renumbered 2022 (366), Sch 1[9].
Part 6 Electricity infrastructure fund
pt 6 (previously Part 2C): Renumbered 2022 (366), Sch 1[10].
34 Financial reporting by scheme financial vehicle—the Act, s 53(3)
(1) The scheme financial vehicle must, as soon as practicable after the end of each financial year, prepare a financial report about the Fund.(2) The financial report must—(a) be prepared in accordance with the Australian Accounting Standards, and(b) include information on the net exposure of the scheme financial vehicle to the wholesale electricity market under—(i) LTES agreements, and(ii) risk management contracts that are derivative arrangements.(3) The scheme financial vehicle must prepare monthly records of payments into and from the Fund.(4) In this clause—Australian Accounting Standards means the standards issued by the Australian Accounting Standards Board, as in force from time to time.cl 34 (previously cl 16H): Renumbered 2022 (366), Sch 1[11].
35 Contribution determination—matters to be taken into account—the Act, s 56(6)
(1) In making a contribution determination, the regulator must take the following into account—(a) the need to limit variability in contribution determinations from year to year,(b) the equitable allocation of the contribution determination between distribution network service providers based on each provider’s—(i) volumetric energy delivery in the previous financial year, and(ii) peak demand in the previous financial year,(c) the need for the scheme financial vehicle to be able to meet its liabilities as they fall due,(d) information provided to the regulator by the consumer trustee, the financial trustee, the infrastructure planner or the Tribunal.(2) In this clause—peak demand means the aggregate amount of actual, non-coincident and raw electricity demand, measured in megavolt amps, at the zone substation level and at the trading interval when the aggregate amount is the highest.volumetric energy delivery means the measured or estimated amount of electricity delivered to electricity customers from a distribution network service provider’s network, measured in gigawatt hours at the appropriate customer charging location.cl 35 (previously cl 16H): Renumbered 2022 (366), Sch 1[11].
36 Notification of contribution determinations—the Act, s 64(4)
The regulator must, within 1 week after a contribution determination is published in the Gazette, give each distribution network service provider a notice setting out the percentage of the contribution determination relating to LTES agreements for generation infrastructure.cl 36: Ins 2022 (366), Sch 1[12].
37 Recovery of amounts payable under contribution orders—the Act, s 58(6)
(1) A distribution network service provider must calculate the part of the amount payable by the provider under a contribution order that is attributable to each exempt customer (the relevant component).(2) A distribution network service provider is authorised to recover the relevant component from an exempt customer if the distribution network service provider gives the exempt customer the following credit against the charges payable by the exempt customer—(a) for an exempt customer who uses electricity supplied by the distribution network service provider to produce green hydrogen—(i) if the applicable reference year is before 2029—90% of the relevant component, or(ii) if the applicable reference year is 2029—60% of the relevant component, or(iii) if the applicable reference year is 2030—30% of the relevant component,(b) for an exempt customer who uses electricity supplied by the distribution network service provider in an industry that is both emissions intensive and trade exposed—90% of the part of the relevant component that is attributable to LTES agreements for generation infrastructure.(3) In this clause—exempt customer means a person who, under the Electricity Supply Act 1995, Schedule 4A, clause 22 is, for an electricity load, exempt from the energy savings scheme established by that Schedule.green hydrogen has the same meaning as in the Electricity Supply Act 1995, Schedule 4A, Part 1.reference year means the reference year identified in an order under the Electricity Supply Act 1995, Schedule 4A, clause 22.cl 37: Ins 2022 (366), Sch 1[12].
38 Payment of contribution by distribution network service provider—the Act, s 58(2)
A contribution order must specify that the amount the distribution network service provider is to pay into the Fund for a financial year is to be paid in 4 equal instalments payable on or before each of the following—(a) 1 November,(b) 1 February,(c) 1 May,(d) 1 August.cl 38 (previously cl 16J): Renumbered 2022 (366), Sch 1[13].
39 Provision of information to regulator—the Act, ss 60(4), 61(2) and 63(4)
The consumer trustee, the financial trustee and the infrastructure planner must, if requested to do so by the regulator, provide information to the regulator that the regulator considers reasonably necessary to enable the regulator to make a contribution determination.cl 39 (previously cl 16K): Renumbered 2022 (366), Sch 1[13].
Part 7 Miscellaneous
pt 7 (previously Part 3): Renumbered 2022 (366), Sch 1[14].
40 Appointment of consumer trustee—the Act, s 66(5)(a)
(1) A person may be appointed as consumer trustee only if the person is a company limited by guarantee.(2) The company limited by guarantee must—(a) have AEMO as a member, and(b) not have any other members except for one or more of the following—(i) the Crown in right of the Commonwealth,(ii) the Crown in right of New South Wales,(iii) the Crown in right of another State or Territory, and(c) be a subsidiary of AEMO, and(d) have a constitution that sets out—(i) objects that are not inconsistent with the exercise of the functions of the consumer trustee, and(ii) the functions of the company’s members, and(e) enter into an agreement with AEMO that deals with—(i) the governance arrangements of the company, and(ii) the provision by AEMO of services to assist the company in exercising its functions as consumer trustee.(3) This clause applies only to the first person appointed as consumer trustee under the Act, section 60.cl 40 (previously cl 17 (previously cl 8)): Renumbered 2022 (366), Sch 1[14].
41 Infrastructure planner recommendations about REZ network infrastructure projects—the Act, s 30(2)
(1) The infrastructure planner must assess and make recommendations about network operators who may be authorised or directed to carry out a REZ network infrastructure project.(2) The infrastructure planner may determine—(a) the extent of the assessment, and(b) how the assessment will be carried out.cl 41 (previously cl 18): Renumbered 2022 (366), Sch 1[14].
42 Penalty notices—authorised officers
(1) This clause applies if the AER is appointed as the regulator.(2) For the purposes of the Act, section 76(6), definition of , the AER is prescribed.cl 42 (previously cl 19): Renumbered 2022 (366), Sch 1[14].
Schedule 1 Members and procedures of NSW renewable energy sector board
clause 7
1 Payment of allowances
An appointed member is entitled to be paid allowances to reimburse the member for expenses, including travel and accommodation, as determined by the Minister.
2 Vacancy
(1) The office of an appointed member becomes vacant if the appointed member—(a) dies, or(b) completes a term of office and is not re-appointed, or(c) resigns the office by written instrument to the Minister, or(d) is removed by the Minister under subclause (2), or(e) becomes bankrupt, applies to take the benefit of any law for the relief of bankrupt or insolvent debtors, compounds with the member’s creditors or makes an assignment of the member’s remuneration for their benefit, or(f) becomes a mentally incapacitated person, or(g) is convicted in New South Wales of an offence that is punishable by imprisonment for 12 months or more or is convicted elsewhere than in New South Wales of an offence that, if committed in New South Wales, would be an offence so punishable.(2) The Minister may remove an appointed member from office at any time.
3 Disclosure of pecuniary and other interests
(1) If—(a) a member has a direct or indirect pecuniary or other interest in a matter being considered or about to be considered at a Board meeting, andthe member must, as soon as possible after the relevant facts have come to the member’s knowledge, disclose the nature of the interest at a Board meeting.(b) the interest appears to raise a conflict with the proper performance of the member’s duties in relation to the consideration of the matter,(2) A disclosure by a member at a Board meeting that the member—(a) is a member, or is in the employment, of a specified company or other body, or(b) is a partner, or is in the employment, of a specified person, oris a sufficient disclosure of the nature of the interest in a matter relating to that company or other body or to that person which may arise after the date of the disclosure and which is required to be disclosed under subclause (1).(c) has some other specified interest relating to a specified company or other body or to a specified person,(3) Particulars of a disclosure made under this clause must be recorded by the Board and made available to any person on request.(4) After a member has disclosed the nature of an interest in a matter, the member must not, unless the Board otherwise determines—(a) be present during a deliberation of the Board that relates to the matter, or(b) take part in a decision of the Board that relates to the matter.(5) The member who made the disclosure may be present at the time the Board is making a determination under subclause (4) but must not take part in the making of the determination.(6) Before making a determination under subclause (4), the Board must consult with a person who has relevant experience in probity and conflicts of interest.(7) A contravention of this clause does not invalidate a decision of the Board.
4 General procedure
(1) The joint chairpersons together may call a Board meeting at any time.Note—Section 7(5) of the Act requires the Board to meet at least once every 6 months.(2) The joint chairpersons together must call a Board meeting if requested by a simple majority of the members.(3) The procedure for the calling of Board meetings and for the conduct of business at those meetings is, subject to the Act and this Regulation, to be determined by the Board.
5 Presiding member
(1) Each joint chairperson is to preside at alternate Board meetings, as agreed to by both joint chairpersons or, in the absence of an agreement, as determined by the Secretary.(2) In the absence of the joint chairperson nominated to preside at a Board meeting, the other joint chairperson is to preside at the meeting.(3) In the absence of both joint chairpersons at a Board meeting, a member elected by the members who are present at the meeting is to preside at the meeting.
6 Quorum
(1) The quorum for a Board meeting is a majority of the members for the time being, subject to subclause (2).(2) The quorum must consist of at least—(a) 1 member appointed under section 7(2)(a)(i), (ii) or (vii) of the Act, and(b) 1 member appointed under section 7(2)(a)(iii)–(vi) of the Act, and(c) 1 member appointed under section 7(2)(a)(viii) of the Act, and(d) 1 member appointed under section 7(2)(a)(ix) of the Act, and(e) the Energy Corporation.
7 Voting
(1) A decision supported by the majority of votes cast at a Board meeting at which a quorum is present is the decision of the Board, subject to subclauses (2)–(4).(2) A majority must consist of—(a) a majority of the votes cast by the members appointed under section 7(2)(a)(i)–(vii) of the Act, and(b) a majority of the votes cast by the members appointed under section 7(2)(a)(viii) and (ix) and (c) of the Act and the Energy Corporation.(3) If there is an equality of votes among the votes cast by the members specified in subclause (2)(a), the member who is also appointed as joint chairperson under section 7(3)(a) of the Act has a second or casting vote.(4) If there is an equality of votes among the votes cast by the members specified in subclause (2)(b), the member who is also appointed as joint chairperson under section 7(3)(b) of the Act has a second or casting vote.
8 Transaction of business outside meetings or by telecommunication
(1) The Board may, if it thinks fit, transact any of its business—(a) by the circulation of papers, by email or other electronic means, among all members, or(b) at a meeting at which all or some members participate by telephone, audio-visual link or other means, but only if a member who speaks on a matter at the meeting can be heard by the other members.(2) If the Board transacts its business by the circulation of papers under subclause (1)(a), a written resolution approved in writing by a majority of the members, as specified in clause 7 of this Schedule, is taken to be a decision of the Board made at a Board meeting.(3) For the purposes of a meeting held under subclause (1)(b) or the approval of a resolution under subclause (2), each member has the same voting rights as at an ordinary Board meeting.(4) A resolution approved under subclause (2) is to be recorded in the minutes of the Board meeting.
9 Alternate members
(1) An appointed member may, at any time with the approval of the Secretary, appoint a person to act in the place of the appointed member during the absence or illness of the member.(2) While acting in the place of the appointed member, the alternate member has all the functions of the appointed member and is taken to be an appointed member.(3) The Secretary may delegate the Secretary’s function under subclause (1) to an employee of the Department.
10 Minutes
The Board must keep minutes of each Board meeting and the minutes must include all decisions of the Board.
11 Code of conduct
The Minister may issue a code of conduct for appointed members.
12 First meeting
The Secretary may call the first Board meeting as the Secretary thinks fit.
Schedule 2 Penalty notice offences
1 Application of Schedule
(1) For the purposes of the Act, section 76(2)—(a) each offence created by a provision specified in this Schedule is an offence for which a penalty notice may be issued, and(b) the amount payable for the penalty notice is the amount specified opposite the provision.(2) If the provision is qualified by words that restrict its operation to limited kinds of offences or to offences committed in limited circumstances, the penalty notice may be issued only for—(a) the limited kind of offence, or(b) an offence committed in the limited circumstances.
Column 1 | Column 2 | Column 3 |
Provision | Penalty—corporations | Penalty—individuals |
Offences under the Act | ||
Section 17(1) | $55,000 | $2,750 |
Section 18(4) | $55,000 | $2,750 |
Section 75(1) | $22,000 | $1,100 |
sch 2: Ins 2021 (659), Sch 1[6].