In August 2021, Energy Ministers agreed that the national gas regulatory framework be reviewed and extended to accommodate hydrogen, biomethane and other renewable gases. As part of the agreement, Energy Ministers decided to prioritise extending the regulatory frame to low-level hydrogen blends and other renewable gases that can be used in existing natural gas appliances. These gases are also referred to as natural gas equivalents.
AEMO has been requested to review its Procedures to identify and make changes necessary to facilitate natural gas equivalents in the Declared Wholesale Market (DWGM), Short Term Trading Market (STTM) and the retail markets in NSW and ACT, Queensland, Victoria and South Australia. The AEMC are reviewing the arrangements in the National Gas Rules (NGR) and jurisdictional officials are reviewing the National Gas Law (NGL), National Energy Retail Law and National Energy Retail Regulations.
Information on the broader review can be found on the following page set up by the Commonwealth Department of Industry, Science, Energy and Resources.
Terms of Reference
Energy ministers have directed AEMO under the NGL to undertake a review of the National Gas Procedures. The terms of reference provided to AEMO by Energy Ministers requests that AEMO identify any changes to the STTM, DWGM and regulated retail market procedures to:
- Ensure that settlement and metering within these markets operates as intended.
- Address any other material gaps in these markets that may be identified through consultation with market participants, other market bodies and government officials.
The terms of reference outline the following key milestones:
- Publish a consultation paper on potential Procedure changes in October 2021.
- Develop a set of draft recommendations for Procedure changes that will be made available for consultation in late March 2022.
- Make Final recommendations (considering any industry feedback) on Procedure changes by September 2022.
- Implement any changes to the Procedures once the NGL and NGR have been amended.
On October 21 2021, AEMO published a consultation paper: Extending the national gas regulatory framework to hydrogen blends & renewable gases – review of the Procedures. The consultation paper provides AEMO’s preliminary view on the scope of potential changes required to the Procedures in the DWGM, STTM and regulated retail gas markets to facilitate natural gas equivalents.
AEMO is seeking industry’s feedback on the proposed changes in the consultation paper. Written feedback to this paper should be sent via email to GWCF_Correspondence@aemo.com.au using the provided response template and the subject should include: Hydrogen blends and renewable gases Procedures review.
The closing date for submissions to this consultation paper is 5:00 PM AEDT Thursday 2 December 2021.