The Ministerial Council on Energy (MCE) has confirmed that a common legislative framework will be established to cover access pricing for both gas and electricity distribution and transmission. The key aspects of the common legislative framework will cover:
- scope of regulation - which transmission and distribution facilities are subject to the regime
- form of regulation - forms of regulation that will be provided for in the Rules and the principles to be applied in choosing which to apply to the different services provided by the facilities
- regulatory procedures - procedures that must be adopted to access pricing determinations while more detail will be provided by the Australian Energy Market Commission (AEMC) in the Rules
- pricing principles - will be included to guide the AEMC in making Rules for pricing and for the Australian Energy Regulator (AER) when it interprets and applies the Rules
- information disclosure - vesting powers in the AER to gather information and providing for accounting and other disclosure requirements
- review of decision making - including appeal and review mechanisms, as determined by the MCE.
The National Gas Law will contain the following:
- introduction (Chapter 1) - which will include all definitions and vest power in the MCE to issue Statements of Policy Principle
- functions and Powers of Regulatory Bodies (Chapter 2) - Responsibility for the economic regulation of gas transmission and distribution networks will be vested in the AER rather than the ACCC and local regulators. The functions of the National Gas Pipelines Advisory Committee and Code Registrar will be transferred to the AEMC and all rule making functions will be conferred on the AEMC
- access (Chapter 3) - the current Gas Pipelines Access Law and the Gas Code will be included in the NGL
- Greenfields Pipeline Incentive (Chapter 4) - two measures will be adopted to maximise the potential for investment in greenfields projects. The National Competition Council will be allowed to make a binding no-coverage recommendation to the Minister for 15 years if a new pipeline does not meet the pipeline coverage criteria. Also all international transmission pipelines which source gas from outside Australia will be exempt from price regulation for 15 years.
- proceedings under the NGL (Chapter 6) - the AER will be empowered to enforce the provisions of the NGL, regulations and Rules by applying to the Court for an order declaring that a person is in breach of the law. Upon making the declaration, the Court can order the payment of a civil penalty, order the person to desist from the breach, remedy the breach or implement a compliance program. In addition the NGL can be enforced by any third person in a Court. The AER will also be able to apply for an injunction stopping the breach and to issue an infringement notice for breach of any civil penalty provision. Criminal offences under the existing Law will be carried over to the NGL.
- The Making of National Gas Rules (Chapter 7) - The AEMC will have the same rule making function under the NGL as under the NEL.
- schedules - will be attached to the NGL dealing with various matters.
The NGL will be supplemented by the National Gas Rules.
