This update introduces a significant new regulation-making power under the Act. The key change is the insertion of Section 9(3)* and Section 9(4), which authorises the Governor to modify the National Electricity Rules as they apply in New South Wales. These modifications can designate certain network cost events, such as cost pass-throughs, as triggers for "strategic benefit payments". This creates a new mechanism linking the national regulatory framework for network revenue with payment obligations defined in the *Electricity Supply Act 1995. The primary consequence is the introduction of a new potential financial liability for network operators, contingent on future regulations.
This update most significantly impacts regulated distribution and transmission network operators, the Australian Energy Regulator (AER), and government bodies responsible for energy policy and regulation.
The update introduces *Section 9(3)**, granting the Governor a new power to make regulations that modify the operation of the *National Electricity Rules (NER) in NSW. This power is specifically for creating provisions that link "relevant events" to the requirement for "strategic benefit payments". This is a material change as it allows the NSW government to alter the application of the national rules to implement state-specific financial policies, creating a new layer of regulatory intervention on top of the established AER framework.
The newly inserted Section 9(4)* defines the key terms for this new power. "Relevant events" are explicitly tied to specific mechanisms within the NER, namely pass-through events, positive change events, and negative change events under clause 6A.7.3 of the NER. This clarifies that the triggers for these new payments will be the same events that already allow for adjustments to network revenues....
