Legislation
Framework
The Office of the Renewable Energy Regulator (ORER) administers the Renewable Energy (Electricity) Act 2000 (the Act), Renewable Energy (Electricity) Charge Act 2000, Renewable Energy (Electricity) (Small-scale Technology Shortfall Charge) Act 2010 and the Renewable Energy (Electricity) Regulations 2001 (the regulations) to increase renewable electricity generation from Australia's renewable energy sources by encouraging the generation of an additional 45,000 GWh of renewable energy per year by 2020.
The Renewable Energy Target (RET) applies nationally, with the majority of electricity retailers and wholesale electricity buyers on liable grids in all States and Territories contributing proportionately to increase Australia's renewable energy sources.
RET operates by imposing a legal liability to support renewable energy electricity generation on, generally, large wholesale purchasers of electricity. An example of a liable party under the legislation would be an electricity retailer purchasing wholesale electricity to meet retail sale obligations to customers (acquisitions of electricity). The liable parties are directly responsible for supporting an increase in the amount of electricity generated from renewable energy sources, which is implemented through the surrender of renewable energy certificates (RECs) in proportion to their acquisitions of electricity.
Legislation
RET is implemented through the following legislation:
- Renewable Energy (Electricity) Act 2000 - No. 174, 2000 (taking into account amendments of the Renewable Energy (Electricity) Amendment Act - No. 90, 2006, No. 26 2008, No. 73 2008, No. 17, 2009, No. 78, 2009, No. 8, 2010, No.69, 2010)
- Renewable Energy (Electricity) (Charge) Act 2000 - No. 129, 2000 (taking into account amendments of the Renewable Energy (Electricity)(Charge) Amendment Act - No. 150, 2000, No. 79, 2009, No.70, 2010). On 1 January 2011, the name of this Act wil be changed to the Renewable Energy (Electricity) (Large-scale Generation Shortfall Charge) Act 2000.
- Renewable Energy (Electricity) (Small-scale Technology Shortfall Charge) Act 2010 - No.71, 2010.
The legislation establishes the framework for the RET including renewable energy targets, which must be achieved over the period 2001 to 2030, liability requirements, and outlines eligibility requirements for renewable energy sources and power stations.
Amendments to the leglislation
Amendments to the legislation to deliver the enhanced Renewable Energy Target
The legislation establishes the framework for the:
- Large–scale Renewable Energy Target (LRET) including renewable energy targets, which must be achieved over the period 2001 to 2030, liability requirements, and outlines eligibility requirements for renewable energy sources and power stations; and
- Small–scale Renewable Energy Scheme (SRES) including liability requirements, like the quarterly surrender of small – scale technology certificates (STCs), and outlines eligibility requirements for solar water heaters, heat pump water heaters and small generation units (small solar – photovoltaic, wind and hydro electricity systems).
Amendments to the Act
Most of the Amendment Act changes take effect from 1 January 2011, however, ORER encourages all participants to seek their own legal advice and strongly recommend that they read the amendments in full.
General amendments to the Act include:
- referring to renewable energy certificate (REC) as large-scale generation certificates (LGCs) or small-scale technology certificates (STCs);
- separating the Register of RECs into the Register of LGCs and Register of STCs. The Register of STCs will also includes statements that confirm what installation STCs were created for. This includes solar water heater, heat pump water heaters and small generation units;
- amending and including new definitions under section 5 of the Act;
- introducing new requirements that will enforce non-compliance. This includes:
- civil penalty provisions, injunctions, enforceable undertaking and other actions that can be taken by the ORER under Part 15A and 15B of the Act;
- introducing new requirements for improper creation of certificates and providing false information (section 24A and 24B);
- allowing the Minister by legislative instrument to determine emerging renewable energy technology as eligible under the Act;
- updating and introducing requirements for liable entities to lodge annual energy acquisition statements and surrendering certificates for LRET and SRES (section 44 – 48B of the Act);
- updating requirements for partial exemption certificates and providing the Minister with the ability to obtain data from or penalise companies that carry on an emission intensive trade exposed activity – section 46A to 46F of the Act;
- removing reference to the Carbon Pollution Reduction Scheme Act 2010 in the regulations;
- automatically reflecting revised documents or standards that are referenced in the regulations;
- various transitional requirements relating to the creation and registration of RECs, including timelines for contracts;
- reviewing the Act every two years from 30 June 2012 – section 162 of the Act. A report detailing the outcomes of the review must be provided to the Minister by 31 December in that year, ie 31 December 2012. After receiving the report the Minister then has 15 parliamentary sitting days to table the report in parliament
Amendments that support LRET under the Act include:
- adjusting the renewable energy targets (section 40) to give consideration to:
- the amount of LGCs that will be valid by the end of the 2010 calendar year;
- the commencement of waste coal mine gas, if it becomes eligible in the future;
- allowing waste coal mine gas to be eligible from a day prescribed by the regulations rather than 30 June 2010;
- allowing the regulator to accredit waste coal mine gas power stations within six months of the regulations prescribed day;
- allows the regulator in certain circumstances to provide additional time to create LGCs for power stations from the 2008 generation year
Amendments that support SRES under the Act include:
- the introduction of the clearing house under Part 2A of the Act. The clearing house allows agents and individuals that are registered owners of STCs to trade STCs in the clearing house for a set price of $40 per STC plus GST (if applicable). Note this does not preclude agents and individuals trading STCs outside the clearing house;
- limiting the amount of STCs that can be created by solar water heaters and heat pump water heaters – section 21 (1A);
- allows the regulator to determine the number of STCs that may be created for a particular solar water heater installation – section 22 (2);
- allows the regulations to limit the amount of STCs that can be created by small generation unit – section 23A (1A);
- establishing a scheme for inspection of new small generation unit installations – section 23AAA;
- allows the regulations to amend the solar credit multiplier and the first kW of rated power output that can be used for the solar credit multiplier – section 23B;
- introduces new eligibly requirements for off-grid small generation unit installations, including solar credit multiplier requirements and caps – section 23B;
- allowing the regulator to create STCs for liable entities if there are no STCs in the market to meet their compliance obligations under the Act (section 30P of the Act);
- introducing quarter surrender requirements for liable entities (section 38AA – 38AI of the Act);
- the regulator to give an estimate of the liable entity’s first, second and third quarter STP surrender for the given year by 15 April if the liable entity provides a energy acquisition station by 1 April or not if the regulator has not assessed they energy acquisition statement by 1 April – section 40C of the Act;
- introducing the small-scale technology percentage (STP) – section 40A of the Act;
- the regulator to publish an estimate of the STP for each of the next 2 years by 31 March after the given STP has been set – section 40B of the Act;
- introducing requirements for paying the small-scale technology shortfall charge (SRESC) – section 67 of the Act and paying the penalty charge – section 99A of the Act. Note, if the STSC is paid there is no redemption clauses in the Act;
- allowing the regulator to publish liable entities that have STC shortfalls for a year – section 134 of the Act
Amendments to the LCharge Act
Amendments to the Renewable Energy (Electricity) (Charge) Act 2000 apply from 1 January 2011 and:
- has been changed to administer the large-scale generation shortfall charge (LRESC) under the LRET;
- changes the renewable energy shortfall charge reference to the LRESC; and
- changes the title of the Renewable Energy (Electricity) (Charge) Act 2000 to Renewable Energy (Electricity) (Large-scale Generation Shortfall Charge) Act 2000.
Inclusion of new SCharge Act
The Renewable Energy (Electricity) (Small-scale Technology Shortfall Charge) Act 2010 has been implemented to administer the small-scale technology shortfall charge (SRESC) under the SRES. The SRESC is $65 per STC that is not surrendered per quarter and will apply from 1 January 2011.
Amendments to the regulations
In addition to the legislation changes, consequential amendments are required to the Renewable Energy (Electricity) Regulations 2001 (the Regulations).
For administrative information on these changes contact the ORER on (02) 6159 7700 or via email at orer@orer.gov.au
For policy information on these changes contact the RET policy at the Department of Climate Change
Read summaries of the proposed and completed regulation amendments
Regulations
The Principal Renewable Energy (Electricity) Regulations 2001 (the regulations) were made on 6 February 2001. However, the consolidated Renewable Energy (Electricity) Regulations 2001 are now in force.
The legislation is supported by the regulations. The regulations contain more detailed rules on a number of issues, including additional eligibility criteria for renewable energy sources, accreditation of power stations, eligibility requirements for solar water heaters and small generator units.
Regulation amendments
The ORER regularly amends the Renewable Energy (Electricity) Regulations 2001 (the Regulations) to:
- set the Renewable Power Percentage, which establishes the rate of liability. The RPP is set to achieve the interim targets as specified in the legislation; and
- conduct other administrative changes as required and appropriate.
To fully understand the regulation amendment process read the Regulatory plan.
The Department of Climate Change updates the Regulations to include:
- policy changes; or
- legislative changes as required due to the Renewable Energy (Electricity) Amendment Act 2006, and the Renewable Energy (Electricity) Amendment Act 2009.
Read summaries of the proposed and completed regulation amendments
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