The federal government has called for consultation to include emissions reduction in the National Energy Objectives, which govern the way electricity and gas markets and regulations work across the states and territories.
This consultation is the next step in implementing the landmark decision of federal, state and territory Energy Ministers at their recent meeting in August 2022.
Minister for Climate Change and Energy Chris Bowen the reform is the first substantial change to the objects of the National Energy Laws in 15 years and will give the three market bodies, the Australian Energy Market Commission, Australian Energy Regulator and Australian Energy Market Operator, the explicit requirement to consider emissions reduction in their work.
The National Energy Laws Amendment (Emissions Reduction Objectives) Bill 2022 and consultation paper has been drafted to incorporate emissions reductions into the national energy objectives, which guides market bodies in their decision making.
Bowen said the bill was integral to managing the country’s energy transition.
“I welcome the release of the draft bill and consultation paper on incorporating an emissions- reduction component into the national energy objectives. It sends a clear policy signal to market participants, investors and the public of the government’s commitment to work together to manage the transformation of the energy sector to achieve a decarbonised, modern and reliable grid of firmed renewables.”
The proposed legislation incorporates an emissions reduction objective into each of the three national energy laws: the National Electricity Law (NEL), the National Energy Retail Law (NERL) and the National Gas Law (NGL), through consistent amendments.
Bowen encouraged stakeholders to engage with the draft bill during the consultation phase running until February 7.
The final draft will be progressed to Energy Ministers for final agreement early in 2023.