Resource Centre - Q&As
A process has been established for the resolution of RIT-T disputes, including the required timeframe for the lodgement of a dispute submission.
Should any relevant parties seek to challenge the conclusions of a Project Assessment Conclusions Report, ElectraNet will seek to resolve the issue in accordance with Clause 5.6.6A of the National Electricity Rules and the Regulatory Investment Test for Transmission Application Guidelines published by the AER in June 2010.
A dispute must be lodged with the AER and ElectraNet within thirty days of ElectraNet publishing the Project Assessment Conclusions Report.
The Energy Reform Implementation Group (ERIG) conducted a review of the operation of Australia’s energy sector and found that the investment decision-making criteria in the Regulatory Test were appropriate and should be retained. However, the ERIG recommended that the reliability and market benefits sections of the Test should be amalgamated.
Consultations were conducted on the framework and the outcome was that the new RIT-T process would remove the distinction between reliability-driven projects and projects motivated by the delivery of market benefits. Proposed electricity transmission projects are now assessed against both local reliability standards and their ability to deliver broader benefits to the market.
The RIT-T provides a single framework for all electricity transmission investments and removes the previous distinction in the Regulatory Test between reliability-driven projects and projects motivated by the delivery of market benefits.
Interested parties are representatives or individuals who AEMO determines have an interest in regulated network planning and development – such as large industrial-load electricity transmission customers – who may offer a non-network solution to reduce electricity use during times of peak demand.
This type of solution may defer or remove the need for regulated transmission investment, while still ensuring adequate network capability to achieve reliability of supply.
Interested parties also include an end-user or a representative who, in the opinion of the Australian Energy Regulator (AER), has or identifies themselves to the AER as having the potential to suffer a material and adverse market impact from the proposed electricity transmission investment that is the preferred option identified in the Project Assessment Conclusions Report.
Registered participants include power generators, transmission network customers, traders, re-allocators, retailers and electricity distributors (such as SA Power Networks). Registration with AEMO as a registered participant allows participation in the NEM.
Yes. According to the NER, if the most expensive technically and economically feasible option for a regulated electricity transmission investment is more than $6 million, ElectraNet is required to consult with registered participants, the Australian Energy Market Operator (AEMO) and interested parties using the RIT-T market consultation process. The extended consultation timeframes involved in applying the RIT-T increases the opportunity for market input into this process.
The application of the RIT-T ensures that the recommended investment solution is the most economic option, including consideration of non-network options (for example, embedded generation or demand-side response), that satisfies the identified need while meeting mandated reliability standards and the technical requirements of the National Electricity Rules (NER).
The Regulatory Test is the now superseded cost-benefit analysis which was applicable to regulated electricity transmission investment assessments initiated prior to 1 August 2010 to ensure the recommended investment solution was the least cost option. Note that SA Power Networks continues to apply the Regulatory Test to major distribution-driven network augmentation projects, including those involving electricity transmission options.
The RIT-T is a cost benefit analysis applicable to relevant regulated electricity transmission investments initiated from 1 August 2010 onwards, to ensure the recommended solution is the most economic. It requires consideration of the costs of options to address the identified need, as well as the potential benefits to the broader market. It seeks a solution to deliver the greatest net benefit to the market.
Find out more by visiting our RIT-T page.