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Renewable Energy (Electricity) Amendment Bill 2006

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2004-2005-2006

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

SENATE

 

 

 

RENEWABLE ENERGY (ELECTRICITY) AMENDMENT BILL 2006

 

 

 

 

REVISED EXPLANATORY MEMORANDUM

 

 

 

 

(Circulated by authority of the Minister for the Environment and Heritage,

Senator the Honourable Ian Campbell)

 

 

 

THIS MEMORANDUM TAKES ACCOUNT OF AMENDMENTS MADE BY THE HOUSE OF REPRESENTATIVES TO THE BILL AS INTRODUCED

 

 



RENEWABLE ENERGY (ELECTRICITY) AMENDMENT BILL 2006

 

OUTLINE

The purpose of this Bill is to implement the Government’s agreed response to a review of the Renewable Energy (Electricity) Act 2000 (the Act) and improve the administrative integrity, effectiveness and efficiency of the Act by:

 

·          setting time-limits for the creation of renewable energy certificates and providing the opportunity to voluntarily surrender certificates;

·          providing for provisional accreditation of proposed generation projects, establishing timeframes for determining the eligibility of proposed projects by the Renewable Energy Regulator and clarifying the components of a power station;

·          allowing for the publication of additional data on baselines and renewable electricity generation;

·          clarifying the provisions and definitions in the Act for Eligible Renewable Energy Sources and providing increased opportunities for bioenergy;

·          clarifying the provisions with respect to the claiming of renewable energy certificates associated with solar water heaters and small generation units;

·          clarifying the provisions in relation to the eligibility of solar water heaters and expediting the process by which certificates can be claimed for new solar water heater models as they become commercially available;

·          allowing for recent reforms in the National Electricity Market and potential new market operators;

·          clarifying the provisions in relation to a relevant acquisition of electricity to ensure that only one entity is made liable in relation to the purchase of a particular quantum of electricity;

·          providing the Renewable Energy Regulator with the power to vary a number of assessments and determinations under the Act, including varying the energy acquisition statement, renewable energy shortfall statement and the 1997 eligible renewable energy baselines for accredited power stations;

·          providing the Renewable Energy Regulator with information gathering powers to enable the effective monitoring and compliance with the provisions of the legislation; and

·          allowing for the suspension of an accredited power station under a number of circumstances including where gaming is suspected; that is, whereby power station outputs are manipulated to increase the number of renewable energy certificates that can be created without increasing renewable energy generation.

 

 

FINANCIAL IMPACT STATEMENT

 

This Bill does not change the net financial impact of the Renewable Energy (Electricity) Act 2000 .



 

REGULATION IMPACT STATEMENT

 

 

Amendments to the Renewable Energy (Electricity) Act 2000 and the Renewable Energy (Electricity) Regulations 2001

 

 

Background

 

The Mandatory Renewable Energy Target (MRET) was introduced as part of the 1997 Safeguarding the Future: Australia’s Response to Climate Change statement.  MRET requires an additional 9500 gigawatt hours (GWh) per annum in renewable electricity generation in Australia by 2010.  The measure will help slow the current growth in electricity generation emissions, delivering an estimated annual abatement of 6.6 Megatonnes carbon dioxide equivalent (Mt CO 2 -e) from 2010.  This is approximately 10 per cent of total abatement from existing greenhouse measures designed to achieve Australia’s 108 per cent emissions target. 

 

MRET is underpinned by the Renewable Energy (Electricity) Act 2000 (the Act) and the Renewable Energy (Electricity) Regulations 2001 (the Regulations) and commenced on 1 April 2001.  The legislation stipulated an independent review of the Act’s operation two years after its commencement to consider whether the measure is likely to accomplish its stated objectives.  The Review Panel’s report was tabled on 16 January 2004.

 

In response to the Review, the Government agreed to implement a number of the Review’s recommendations as they relate to enhancing market transparency, improving business certainty, encouraging innovation through recognising emerging renewable electricity generation technologies, and increasing opportunities for bioenergy and solar technologies.  The Government also agreed to implement the Review’s recommendation to adopt, except where necessary to accommodate the agreed recommendations, all other provisions of the Renewable Energy (Electricity) Amendment Bill 2002 (the 2002 Amendment Bill).

 

Amendments will be required to both the Act and the Regulations to implement these improvements.  An Amendment Bill will incorporate many of the agreed Review recommendations and adopt the relevant provisions from the 2002 Amendment Bill. 

 



 

Enhancing market transparency and improving business certainty

 

Establish time limits for the creation of Renewable Energy Certificates

 

Currently under the MRET measure, Renewable Energy Certificates (RECs) can be created anytime after eligible generation occurs.  Most generators, particularly smaller generators, create RECs as soon as technically feasible.  However, the possibility remains that some generators may seek to constrain supply in the REC market by creating RECs on a strategic basis. 

 

During the Review, it was acknowledged that market transparency and efficiency would be improved by requiring generators to create RECs within a reasonable time of the generation occurring.  Options, including a scheme based on the elapse of a time period from the date of generation were considered.  However, the Government decided to dismiss these options to avoid administrative complexity. Instead, an option that establishes common deadlines that must be met by all generators was preferred. 

 

The MRET Review had suggested, with respect of any energy reported in an Electricity Generation Return (EGR) on or before 14 February in any year, that RECs should be created no later than 34 weeks subsequently (ie. by 10 October of that year).  The Review considered that the 34 week deadline allowed 30 weeks for possible adjustments of metering figures by NEMMCO and four weeks for REC creation by the generator.  However, further discussions with the Renewable Energy Regulator (the Regulator) concluded that possible adjustments to metering figures often occur past the 30 weeks identified by the Review.  The Government has decided to allow REC creation until the end of the year following the year of generation, an increase by 10 weeks to the Review’s recommendation.  This will reduce the administrative and compliance risk of RECs being incorrectly created. 

 

Generally, submissions to the Review on suggested timeframes for the creation of RECs varied.  Some parties thought six months after the end of the year in which the generation took place was appropriate, whereas a number of submissions preferred a longer timeframe, ie within 12 months of the actual generation. 

 

There will be some very minor compliance costs for generators who currently have not created RECs with respect of past generation.  However, these generators would have had to create RECs for this generation at some later time to achieve benefits under the measure.  To assist in the transition of these requirements, generators will be given at least 12 months to create RECs for generation that occurred prior to this change taking effect.  Overall, the changes will benefit industry by improving the transparency and efficiency of the market.

 

Allow for the voluntary surrender of Renewable Energy Certificates

 

Under the Act, there is no constraint on the parties who may create RECs.  However, there are restrictions on parties eligible to surrender RECs, with only MRET-registered liable parties able to surrender RECs against a liability.  During the Review, many submissions sought to include a provision to allow any party to purchase and surrender RECs for any purpose, not only against MRET liabilities. 

 

Some submissions noted the potential for double counting of RECs between the Green Power Scheme and MRET.  Currently, Green Power Retailers are required to set aside RECs equivalent to any new generation from MRET accredited power stations that is sold through their Green Power product.  The Office of the Renewable Regulator (ORER) has accommodated the wishes of Green Power participants by allowing Green Power participants to establish a secondary account into which ‘Green Power’ RECs can be deposited.  However, while retailers and others may ‘set aside’ RECs in this way, these RECs are still not extinguished, thus remaining valid and potentially tradeable, and able to be on-sold or surrendered against a liability.  The current practice also adds complexity to the administration of the Green Power scheme. 

 

The MRET Review concluded that allowing voluntary surrender of RECs by owners not registered as liable parties under MRET would be desirable.  A number of submissions to the Review also noted that interested individuals or organisations may wish to purchase RECs for philanthropic purposes, seeking to remove these RECs from circulation through voluntary retirement and, therefore, further encourage additional generation of renewable energy.  However, the measure does not compel or pressure businesses to take any action.

 

The extent to which RECs are likely to be voluntarily surrendered is impossible to predict accurately at this stage.  However, we envisage a very minor increase in REC creation beyond the level expected without voluntary surrender, having a small positive impact on renewable energy investment.  This will not impact significantly on the cost of the measure.

 

Providing for provisional accreditation for proposed generation projects and assessment of applications within 6 weeks
 

Currently, the Regulator can only accredit generators following certain eligibility criteria being met, including that the power station is operated in accordance with any relevant Australian Government and State, Territory and local government planning and approval requirements.  However, such approvals may not be forthcoming until the plant is operational. 

 

Several parties noted the paradox in the approvals sequence and sought a ‘pre-accreditation’ process.  At present, the ORER provides, in some cases, ‘indicative approval letters’.  These letters have provided some comfort, establishing that applications ‘could’ or, in some cases ‘would’ be eligible for accreditation, subject to meeting other eligibility requirements.

 

The MRET Review considered that extending this proposal to provide ‘provisional accreditation’ would strengthen stakeholder confidence in proposed renewable energy projects and the Government has agreed to implement this concept.  However, any ‘provisional accreditation’ from the Regulator at this pre-commissioning stage could only be provided on the basis of what is known at the time of application, and would be subject to the applicant satisfying all the requirements of the Act.  It should be noted that a ‘provisional accreditation’ for a project would not replace the required accreditation process.

 

To assist business certainty, the Government will establish a six-week timeframe under which the Regulator would be required to make decisions on applications for accreditation of generators.  This timeframe will also apply to the ‘provisional accreditation’ process.

 

The costs of the changes will be minimal to the renewable energy industry.  The may be some minor operational costs associated with the Regulator’s administration of the ‘provisional accreditation’ process.  Currently, a fee is applied to applications for accreditation under the Act.  A similar fee will be applied to applications for ‘provisional accreditation’ to cover the Regulator’s administrative costs.

 

            Preparing Returns for solar water heaters and small generation units

 

Under the MRET measure, householders can participate by installing solar water heaters or small scale renewable energy generators, called Small Generation Units for the purposes of the MRET legislation.  To simplify the inclusion of solar water heaters and Small Generation Units under MRET, the ORER has calculated the number of RECs that can be claimed for eligible systems.  RECs for both solar water heaters and Small Generation Units may either be created and traded by the owner of the system, or assigned to a Registered Agent. 

 

Currently under the MRET scheme, Registered Agents voluntarily prepare and submit a yearly Electricity Generation Return to the Regulator outlining the number of RECs created in respect of solar water heaters or Small Generation Units.  To assist with improving business certainty and enhancing market transparency of the MRET measure, the Government will formalise the process of Registered Agents preparing an Electricity Generation Return under the MRET scheme.  Using the information provided in the Returns, the Regulator is able to ensure accountability in the REC creation process, thereby enhancing business confidence in the MRET scheme.

 

The compliance cost of this proposal for Registered Agents has been calculated using information from Electricity Generation Returns previously provided to the Regulator.  Based on 2004 data, 35 Registered Agents provided returns and the average time taken to complete the returns was nearly two hours per return.  This equates to compliance costs of less than $100 per year per registered Agent.  ORER has also implemented a system that allows internet lodgement of returns.  This system provides flexibility and helps minimise further compliance costs to industry.

 

As Registered Agents currently voluntarily provide Electricity Generation Returns to the Regulator, the compliance costs outlined above are business costs already incurred by Registered Agents under the MRET measure.



 

Encourage innovation through recognising emerging renewable electricity generation technologies
 

During the MRET Review, a number of submissions sought to broaden the classification system of existing eligible renewable energy sources within MRET, to include new technology developments or to incorporate new innovations into the measure.  The MRET Review considered a number of proposals and concluded that some would run counter to the intent of the MRET legislation and were inconsistent with the policy objectives of the measure. 

 

The MRET Review also considered broadening MRET eligibility to include other energy displacement technologies, but concluded that it would serve to achieve some, but not all, of MRET’s policy objectives.  The Review recognised that any attempt to anticipate future innovations and developments in the renewable energy sector were inherently ambitious.

 

Other submissions suggested that the Regulator or the Minister be given discretionary powers under the Act to admit new sources that may emerge over the life of the measure.  It was noted that previously proposed administrative amendments to the Act enable regulations to be made to restrict the meaning of any eligible renewable energy source and clarify the meaning of ineligible sources.  The Government concluded that these provisions were appropriate and agreed that the Minister be empowered to make regulations to clarify the interpretation of eligible renewable energy sources, or to determine the eligibility of new renewable energy sources. 

 

While this change will provide a mechanism for the MRET measure to respond to the pace of innovation in the renewable energy industry, the impact of this change is unlikely to have any impact on cost of the measure.  If any change to MRET eligibility is proposed which will have a significant impact on business, it will be the subject of a separate Regulation Impact Statement.

 
Increasing opportunities for bioenergy

 

This section refers to simplifying bioenergy eligibility requirements through removing the ‘primary purpose’ test applying to energy crops, redefining plantations as an energy crop and streamlining eligibility requirements for biomass from registered landfill sites.  The intent is to enable plantations, agricultural crops and biomass that would otherwise go to landfill to achieve a greater rate of uptake under the measure.  These initiatives could also provide another income stream for regional and rural areas and promote salinity mitigation and land remediation activities. 

 

Plantations and Energy Crops

 

The MRET Review reported that contrary to the original policy expectations that energy crops would make a contribution to the MRET target, no energy crops have yet been accredited under MRET.  During the Review, a number of parties argued that the development of the biomass energy sector was being inhibited by certain provisions of the Regulations.  The main concern was with legislative interpretations that exclude plantations and plantings of woody tree species as eligible under the energy crop provisions, and the ‘primary purpose’ test for energy crops, which states that an energy crop must be grown for the primary purpose of energy production.

 

The Government introduced the ‘primary purpose’ test for energy crops because it recognised the potential in growing crops for energy, but sought to ensure that the intent of the crop, prior to its planting, was for energy production.  The ‘primary purpose’ test was also introduced to alleviate any community concerns that other types of biomass, such as wood from native forests, would be used as energy crops for energy production.  Following the MRET Review, the Government concluded that the current arrangements for the treatment of native forest wood waste under MRET offer adequate safeguards.  Removing the ‘primary purpose test’ is not expected to impact on the current safeguards. 

 

Currently wood waste from plantations is required to meet certain requirements to be eligible under the MRET measure, including a ‘higher value test’.  Similar to the ‘primary purpose test’ for energy crops, the Government introduced the ‘higher value test’ as a safeguard to ensure that only genuine waste from plantations was used for energy generation.  During the MRET Review, it was argued that excessive regulation of the plantation sector ran counter to national plantation industry goals.  Parties also suggested that, providing adequate management issues were in place, market forces would be sufficient to ensure only waste and unusable plantation wood would be used for energy generation.

 

The objective of revising the MRET eligibility tests for energy crops is to provide the bioenergy sector with opportunities to achieve greater participation under the measure.  To achieve this objective in relation to energy crops, the Government agreed to consider removing the primary purpose test, providing less restrictive access to biomass from crops grown for multiple purposes and redefining energy crops to include plantations, without the higher value test.

 

Another concern raised in the MRET Review was that the ORER interpreted that woody-stemmed vegetation species are not eligible under the current ‘energy crops’ regulation as they cannot be classified as an ‘agricultural or horticultural’ crop.  Amending ‘energy crops’ to remove the ‘primary purpose’ test and references to ‘agricultural or horticultural crops’, along with redefining plantations under energy crops, which will remove the ‘higher value test’, will provide less restrictive access to biomass from crops grown as plantations for multiple purposes. 

 

Increasing the range of circumstances in which bioenergy crops are eligible will encourage the development of the bioenergy sector.  Types of bioenergy projects that may become eligible are short-cycle plantations, such as energy crops, wood waste from existing plantations and ‘supplementary fuel’ plantations.

 

There are multiple benefits of growing of deep-rooted trees (such as oil mallees) for combating dryland salinity in many parts of Australia.  The Rural Industries Research and Development Corporation, Conservation and Land Management of Western Australia and the Oil Mallee Company for instance, have been at the forefront of developing this concept.  A demonstration project is underway at Narrogin (WA) to use coppiced oil mallees to produce energy, eucalyptus oil (as an industrial solvent), and activated carbon.

 

Projects of this nature would have other environmental and economic benefits, such as combating dryland salinity, erosion control, providing animal habitats, increasing biodiversity, while at the same time providing biomass with economic and social benefit for local communities. 

 

Although recognising the benefits of such projects, recent internal analysis indicates that given the marginal economics of short cycle tree plantations and a typical period of two to three years from initial planting to first harvest, energy crops appear unlikely to become a major contributor under MRET. However, the changes to plantations, in particular the removal of the ‘higher value test’, will make it more appealing for potential suppliers and consumers of wood waste to enter into long term energy supply contracts.  There may be some scope for projects to be initiated as a supplementary fuel source for existing biomass plants.  Again, recent analysis estimates that the capacity factor (amount of generating capacity that on average the power station utilises) for some wood waste and bagasse projects could be increased by up to 5 per cent compared to pre-change levels, through increased eligibility of supplementary feedstocks. 

 

Development of the bioenergy sector could also lead to a range of secondary benefits.  Bioenergy is generally more labour intensive than coal and other fossil fuels.  Jobs could be created in the growing and harvesting of tree crops, the transportation of the biomass, and in the plants converting that biomass to an energy product.  Bioenergy could also provide another income stream for regional and rural areas and promote salinity mitigation and land remediation activities. 

 

Redefining Municipal Solid Waste

 

During the MRET Review, parties raised a number of issues relating to the inclusion of municipal solid waste (MSW) as an eligible renewable energy source and its treatment under the measure.  Some parties were concerned that the inclusion of MSW within MRET perpetuated current unsustainable waste production, while others identified a number of environmental and economic benefits from MSW.  In addition, interested stakeholders expressed a need to harmonise the MRET definition of MSW with other renewable energy schemes, and address anomalies that have occurred in the treatment of MSW.  An example of such an anomaly is where the ‘green waste’ component of MSW is eligible, while the green waste from ‘commercial’ sources is not eligible. 

 

The MRET Review supported the continued eligibility of MSW within MRET and confirmed that only the biomass elements of MSW are eligible for claiming RECs under the scheme.  The Review also concluded that any biomass material that is directly sourced from a licensed landfill or licensed waste transfer station, which would other wise be disposed of in a landfill, should be eligible under the MSW provisions of MRET.  The Government recognises, however, that there are existing generators who source their MSW directly from suppliers, such as fruit markets, and the changes will need to recognise these situations.

 

The objective of redefining MSW to include all biomass material which would otherwise be landfill, including material that is directly sourced from a licensed landfill or licensed waste transfer station, is to remove current anomalies and harmonise the treatment of MSW.  Recent internal analysis indicates that implementing this change is likely to result in a small increase in the level of green waste available as a fuel for MSW generators, which could increase the capacity factor of the MSW plants by approximately 5 per cent pre-change levels.

 

The cost of compliance to industry of this measure is unchanged.  Accredited generators will be required to maintain the current arrangements of maintaining audit trails for biomass waste from the originating source and self-assessments of the biomass components.

 

Increasing opportunities for solar technologies

 

These proposals relate to broadening the eligibility of solar hot water units and increasing the threshold capacity for photovoltaic Small Generation Units from 10kW to 100kW and simplifying deeming arrangements to allow an upfront RECs claim for fifteen years for photovoltaic small generation units. 

 

Photovoltaic Small Generation Units

 

The MRET Review also found the contribution of photovoltaic Small Generation Units to the measure was below the Government’s expectations.

 

In relation to the installation of photovoltaic (PV) units, the Review noted that only a small proportion of eligible small generation units have created RECs under MRET.  During the Review some parties suggested that the current approach was fraught with practical difficulties and potentially high transaction costs.  Currently the administrative burden of claiming RECs for photovoltaic systems often outweighs the benefits, with less than 5 per cent of eligible photovoltaic systems claiming their RECs to date.  

 

It was recognised initiatives were required that would reflect the benefits that flow from photovoltaic usage and help to grow the PV industry in Australia.  This could be achieved by providing incentives for increased uptake of higher capacity photovoltaic Small Generation Units, particularly in commercial building settings, which presently lag behind installation rates in private dwellings. 

 

During the Review several interested parties sought to change the current treatment of these units under MRET by varying the way RECs can be created.  One of the reasons given by parties was to offset some of the capital costs associated with PV units.  The Review saw the proposed change as a way of growing the PV industry and complementing the Australian Government’s existing Photovoltaic Rebate programme, which is designed to partially offset the initial capital cost of purchasing and installing a photovoltaic system. 

 

The proposed changes increase the threshold capacity for photovoltaic Small Generation Units from 10kW to 100kW and simplifies arrangements to allow an upfront claim of RECs for fifteen years, in addition to the current one and five year options, for photovoltaic small generation units.  These changes will increase the assistance offered under MRET from 1-2 per cent to approximately 10 per cent of the upfront costs of a photovoltaic system.  Allowing a one-off up-front claim for RECs will also reduce the compliance and administrative costs for business.  Although no indication of the actual transaction costs was provided during the Review, it can be assumed that a one-off transaction will reduce compliance and administrative costs by at least 50 per cent.



Recent internal analysis indicates that these changes will increase the number of photovoltaic small generation unit installations in commercial buildings by reducing the capital costs and installation costs of such systems.  It is assumed that 90 per cent of off-grid and grid-connected distributed PV installations will fall within these changes.  Accordingly, it is predicted that between now and 2010, REC creation from PV installations will increase by approximately 70,000.

 

The changes also recognise the currently unvalued benefits to the electricity transmission system provided by photovoltaic systems connected to the electricity grid.  Such benefits include reduced transmission losses and infrastructure investment. 

 

For systems claiming 15 years of RECs up front, there is a slight risk of these systems operating for less years due to break-down.  However, it was argued by some parties during the Review that given the costs of photovoltaic units, most users would repair the unit rather than see it lie inoperative.

 

Solar Water Heaters

 

Development of the solar water heater sector has been strong since 2001.  This is mainly due to the implementation of MRET and an increase in state-based solar water heater rebate schemes and regulatory requirements.  Growth rates of between 30 per cent and 40 per cent were observed in the industry from 2001 to 2003.  However, recent data suggests that current growth in sales has slowed to 10 per cent per annum.  In 2003, solar water heaters comprised 26 per cent of the technology mix under MRET [1]

 

Currently under MRET, solar water heater systems are eligible to create RECs, to the extent that the systems displace non-renewable electricity.  This means that installations of solar water heaters in new homes and buildings, and installations of solar water heaters that replace electric water heaters, or electric boosted solar water heaters, are eligible.  However, solar water heaters replacing gas water heaters, gas-boosted solar water heaters, or water heaters using any other fuel are not eligible for RECs.

 

During the Review, a number of parties drew attention to possible confusion and adverse consequences for home and building owners, arising from the exclusion of some solar water heater installations or replacement units from the measure.  For example, replacing an electric hot water heater with a solar water heater (gas or electric boosted) was eligible under the measure, but replacing a gas hot water system with a solar water heater was not.  This situation potentially created disincentives for home owners wanting to install a solar water heater and restricted the possible abatement that could be achieved as solar water heaters generally have lower emissions than gas systems. 

 

With the aim of addressing these possible adverse consequences and removing possible disincentives to the installation of solar water heaters, the Review recommended that all complete solar water heater systems installed, including replacement systems, to be eligible to create RECs to the full extent of their energy displacement capacity.  This recommendation has been welcomed by the solar water heater industry.

 

The Government has agreed that allowing all complete solar water heater systems installed, including new replacement systems, to be eligible to create RECs to the full extent of their energy displacement capacity will encourage the development of the Australian solar water heater industry and contribute to reducing greenhouse gas emissions in heating water.  In addition, allowing these systems is likely to lower the cost of the measure to the extent that solar water heaters are one of the cheapest eligible sources under MRET.  It will also increase opportunities for households to participate in the measure.

 

There is currently limited data from which to draw conclusions regarding future trends in the installations of solar water heaters due to the infancy of current regulatory schemes in the states and territories.  However, any increase in uptake of solar water heaters under the MRET as a result of the proposed changes would be at the expense of other sectors of the renewable energy industry to the extent that it displaces generation from these sources

under the measure. 



Analysis undertaken to model the impacts of the proposed changes suggests that under a business as usual scenario (no changes to the measure), solar water heaters would account for around 29 per cent of the measure by 2010 and around 30 per cent by 2020.  This compares to a high growth scenario that estimates solar water heaters to account for around 31 per cent of the target by 2010 and 2020.  A low growth scenario predicts 30 per cent of the measure will be made up of solar water heaters by 2010 and similar percentage by 2020.  

 

Consultation

 

Extensive consultation on potential changes to the MRET legislation has been undertaken through a variety of processes since 2002.

 

During November 2002, the Environment, Communications, Information Technology and the Arts (ECITA) Legislation Committee, consulted with a wide range of stakeholders during their deliberations on the Renewable Energy (Electricity) Amendment Bill 2002 .  A total of 44 submissions were made to the Committee from a range of organisations including renewable energy companies, energy retailers, industry associations, State Governments and community groups, several of whom appeared as witnesses to assist the Committee.  The ECITA committee presented its report in December 2002 and recommended that the Bill be passed with consideration of the recommendations contained in their report. 

 

To ensure that the proposed scope of the independent review of the Renewable Energy (Electricity) Act 2000 encompassed stakeholders’ concerns, the Minister for the Environment and Heritage invited submissions from interested parties on the terms of reference.  Around 80 submissions were received, leading to a broader investigation than required under the legislation. 

 

The independent Review also sought submissions from interested parties and received over 5000 representations.  The Review held over 100 consultations in major metropolitan and regional centres across all States and Territories, and visited seventeen renewable energy sites.  Interested parties that provided submissions to the MRET Review included renewable energy generators, energy intensive users, the finance sector, Commonwealth, State and Territory governments, energy retailers and industry associations, environment and community groups as well as individuals. 

 

Enhancing market transparency and improving business certainty

 

Submissions to the Review provided a wide range of responses in relation to enhancing market transparency in the measure.  Generally, the submissions were based around transparency of baselines for pre-existing generators, transparency of cost pass-through to end users, establishing time frames for the creation of RECs and establishing an MRET trading floor.  Some submissions also suggested that further information be available from the ORER or the publicly available registers that are required under the measure.  There were no major differing views submitted to the Review in relation to these issues, although, there were variations in relation to the timeframes for the creation of RECs as some submissions wanted shorter timeframes and a number of submissions preferring longer timeframes.

 

Increasing opportunities for bioenergy and solar technologies

 

The bioenergy industry argued for changes in the way biomass was treated under MRET.  In regard to the treatment of plantations and energy crops, the industry felt that the high-value and primary purpose tests provided an unworkable barrier to bioenergy facilities with multiple product streams.  The bioenergy industry has welcomed measures to redefine the definition of municipal solid waste which will help alleviate any anomalies within the measure.

 

The photovoltaic industry argued for a consolidated deeming period, increased deeming thresholds and multiple REC eligibility for photovoltaic (PV) technology electricity generation.  Other submissions supported elements of this approach.  The Victorian Government, the Australia and New Zealand Solar Energy Society and Greenpeace supported extending the deeming arrangements for PV.  The solar water heater manufacturing industry has welcomed the changes that provide further opportunities for the industry.

 

During the review there were no dissenting views on these measures.



 

Conclusion

 

Implementing these improvements to the MRET scheme will enhance market transparency, improve business certainty, encourage innovation through recognising emerging renewable electricity generation technologies, and increase opportunities for bioenergy and solar technologies.  These measures will also provide employment and investment opportunities, and reduce the MRET compliance and abatement costs of MRET.  The bioenergy initiatives will also help to promote salinity mitigation and land remediation activities. 

 

Given the finite nature of the market for additional renewables-based electricity stimulated by MRET, the improvements aimed at creating opportunities for biomass and solar energy could result in some minor redistribution of future benefits between renewable energy investors. However, as this analysis indicates, the overall impact on energy market participants is expected to be positive, and the option of maintaining the status quo would mean foregoing the market and operational benefits inherent in these improvements.    

 

Implementation and Review

 

The preferred option will be implemented through amendments to the Renewable Energy (Electricity) Act 2002 and the Renewable Energy (Electricity) Regulations 2001 .  The Government will monitor the operation of the amendments on an on-going basis and through reporting mechanisms within the measure.  Annual reporting on the operation of the MRET scheme will identify the extent to which there is increased participation by bioenergy and solar technologies within the measure. 

 

Implementing these measures will not incur significant overall net costs for the renewable energy industry and only minor administrative costs for the Government.



 

RENEWABLE ENeRGY (electricity) AMENDMENT BILL 2006

 

Notes on clauses

Clause 1 - Short title

1.       This clause provides that the short title by which the Act may be cited is the Renewable Energy (Electricity) Amendment Act 2006.

Clause 2 - Commencement

2.       Subclause 2(1) provides a table indicating when each provision of this Bill commences.

 

3.       Paragraph 1 of the table in subclause 2(1) provides that the commencement date for sections 1, 2 and 3 and anything in the Bill not elsewhere covered by the table in subclause 2(1) is the day on which the Bill receives Royal Assent.

 

4.       Paragraph 2 of the table in subclause 2(1) provides that the commencement date for the provisions contained in Schedule 1 is a single day to be fixed by Proclamation.  However, if Schedule 1 of this Bill does not commence within six months of the Bill receiving Royal Assent, then it will commence on the first day after the end of this period.  The deferral of commencement date is to allow sufficient time for associated amendments to the Renewable Energy (Electricity) Regulations 2001 (the Regulations) to be made.    

Clause 3 - Schedule

5.       This clause provides that each Act specified in a Schedule is amended or repealed as set out in that Schedule, and any other item in a Schedule has effect according to its terms.

 



Schedule 1 - Amendments

 

Part 1 - Amendments

Administrative Decisions (Judicial Review) Act 1977

Item 1 - After paragraph (ga) of Schedule 1

6.       This item inserts a new paragraph that clarifies the avenues for appeal in relation to assessment decisions under the Renewable Energy (Electricity) Act 2000 (the Act).  The item removes an avenue for appeal under the Administrative Decisions (Judicial Review) Act 1977 , given the comprehensive objections procedure included in sections 54 - 65 of the Act in relation to both shortfall and shortfall charge assessments.  A person who is dissatisfied with an assessment may object in the manner set out in those provisions.   In the event that a liable entity is dissatisfied with the Regulator's decision on an objection, the liable entity may seek review of that decision in the Administrative Appeals Tribunal, or appeal to the Federal Court against the decision (section 60).

Renewable Energy (Electricity) Act 2000

Item 2 - Section 3

7.       This item amends section 3 of the Act to improve the consistency of terminology used between different sections of the Act.

Item 3 - Subsection 5(1)

8.       This item inserts a definition of the term accredited power station for the purposes of the Act.

Item 4 - Subsection 5(1)

9.       This item inserts a definition of the term electronic signature for the purposes of the Act.

Item 5 - Subsection 5(1)

10.     This item inserts a definition of the term eligible renewable energy source for the purposes of the Act.

Item 6 - Subsection 5(1) (definition of identification code )

11.     This item repeals the definition of identification code as it is considered to be no longer necessary.

Item 7 - Subsection 5(1)

12.     This item inserts a definition of the term interest charge for the purposes of the Act.  This definition assists in giving effect to the new section 70, revised by Item 135 below.

Item 8 - Subsection 5(1) (definition of monitoring warrant )

13.  This item substitutes the definition of monitoring warrant with a new definition.  The purpose of this item is to clarify the meaning of monitoring warrant for the purposes of the Act.

 

Item 9 - Subsection 5(1) (definition of National Electricity Code )



14.  This item repeals the definition of National Electricity Code .

 

Item 10 - Subsection 5(1)

  

15.     This item inserts a definition of National Electricity Rules for the purposes of the Act.

 

Item 11 - Subsection 5(1) (definition of NEMMCO)

 

16.     This item substitutes the definition of NEMMCO with a revised definition.  This amendment is required as a consequence of Item 10 above.

Item 12 - Subsection 5(1)

17.     This item inserts a definition of the term nominated person for the purposes of the Act. This definition assists in giving effect to new sections 15B and 30B inserted by Items 42 and 77 respectively below.

Item 13 - Subsection 5(1)

18.     This item inserts a definition of the term occupier for the purposes of the Act.

Item 14 - Subsection 5(1)

19.     This item inserts a definition of the term offence against this Act for the purposes of the Act.  This item clarifies that an offence against this Act includes an offence against section 137.1 or 137.2 of the Criminal Code that relates to this Act.

Item 15 - Subsection 5(1)

20.     This item inserts a definition of the term penalty charge for the purposes of the Act.  This definition assists in giving effect to the new section 70 inserted by Item 135 below.

Item 16 - Subsection 5(1)

21.     This item inserts a definition of the term premises for the purposes of the Act.

Item 17 - Subsection 5(1)

22.     This item inserts a definition of the term registered person for the purposes of the Act.

Item 18 - Subsection 5(1)

23.     This item inserts a definition of the term register of applications for accredited power stations for the purposes of the Act. 

Item 19 - Subsection 5(1) (paragraph (b) of the definition of renewable energy shortfall charge related liability )

24.     This item amends the definition of renewable energy shortfall charge related liability to assist in giving effect to the new section 70 revised by Item 135 below.

Item 20 - Subsection 5(1)

25.     This item inserts a definition of the term required renewable energy for the purposes of the Act.

Item 21 - Subsection 5(1) (definition of senior employee )

26.     This item clarifies the meaning of senior employee for the purposes of the Act.

Item 22 - Subsection 5(1)

27.     This item inserts a definition of the term stakeholder to assist in giving effect to the new sections 30B and 30C inserted by Item 77 below.

Item 23 - At the end of section 5

28.     This item inserts a new subsection 5(3) into the Act.  The purpose of this item is to clarify that the Regulator may approve an electronic form for definition of electronic signature inserted by Item 4 above.

Item 24 - Section 8

29.     This item amends section 8 of the Act to improve the consistency of terminology used between different sections of the Act.

Item 25 - Section 8

30.     The purpose of this item is to clarify that renewable energy certificates may be created for small generation units as well as solar water heaters.

Item 26 - Section 8

31.     This item amends section 8 of the Act by specifying in the overview for Part 2 that Division 2A (inserted by Item 29 below) provides for the provisional accreditation of power stations.

Item 27 - Division 2 of Part 2 (Heading)

32.     This item amends the heading to Division 2 of Part 2 to clarify that the provisions of Division 2 of Part 2 of the Act apply to all persons registering under the Act.

Item 28 - Subsection 9(2)

33.     This item amends subsection 9(2) to clarify that during suspension of a person’s registration under the additional grounds contained in the new section 30A (inserted by Item 76 below), the person cannot be registered.

Item 29 - Division 2A - Provisional accreditation of power stations

34.     This item inserts a new Division 2A (Provisional accreditation of power stations) into the Act, and inserts new sections 12A, 12B and 12C into the Act as follows:

 

New section 12A - Application for provisional accreditation of a power station  

The purpose of this new section is to provide that a registered person may apply to the Regulator for provisional accreditation of a proposed electricity generation system that the person believes would, if built, be a single power station.  This new section also specifies the information that must be provided to enable the Regulator to grant, or refuse to grant, an application for provisional accreditation.

 

New section 12B - Regulator may give provisional accreditation

The purpose of this new section is to provide that if an application for provisional accreditation is made under new section 12A, then the Regulator must grant, or refuse to grant, the application for provisional accreditation. If the Regulator is satisfied that the proposed components of the power station would, if built, be a power station for the purposes of the Act, the Regulator must advise the applicant by written notice.  If the Regulator is satisfied that the proposed components of the power station would not, if built, be a power station for the purposes of the Act, the Regulator must, by written notice given to the applicant, refuse the application.

 

New section 12C - Time limit for deciding applications

The purpose of this new section is to specify that the Regulator must make a decision on provisional accreditation applications within six weeks or a longer period if agreed between the Regulator and the applicant.  If the Regulator has not made a decision within the six weeks or within the agreed time period, the Regulator will be taken to have refused the application.

Item 30 - Subsection 13(1)

35.     This item repeals subsection 13(1) of the Act and replaces it with a new subsection 13(1).  The purpose of this item is to clarify the relationship between a power station and the components of an electricity generation system, and also clarifies the circumstances under which a registered person can apply for accreditation of the components of an electricity generation system as an accredited power station under the Act.

 

36.     This item, together with items 34, 44, and 77 below improves clarity and ease of application and enforcement of provisions of the Act concerning accreditation of power stations, creation of renewable energy certificates (RECs), and submission of electricity generation returns.  This set of items improves the consistency of terminology used between different sections of the Act, and clarifies that a power station is a subset of an electricity generation system.  The items also concentrates responsibility and authority for accreditation, REC creation, and reporting in a single person, the registered person, and provides that all other co-owners and co-operators must unanimously agree to this person assuming these powers and responsibilities.     

Item 31 - Paragraph 13(2)(b)

37.     This item amends paragraph 13(2)(b) of the Act to improve the consistency of terminology used between different sections of the Act.

Item 32 - After paragraph 13(2)(b)

38.     This item inserts a new paragraph 13(2)(baa) into the Act.  The purpose of this item is to add a requirement that an application for accreditation must specify all other co-owners and co-operators of the electricity generation system components for which accreditation is being sought.

Item 33 - Subparagraph 13(2)(ba)(i)

39.     This item amends subparagraph 13(2)(ba)(i) of the Act to improve the consistency of terminology used between different sections of the Act.

 

Item 34 - At the end of subsection 13(2)

40.     This item inserts a new paragraph 13(2)(f) into the Act. The purpose of this item is to require that all other co-owners and co-operators of a particular electricity generation system consent in writing to the making of the application for accreditation as an accredited power station.

Item 35 - At the end of subsection 14(1)

41.     This item inserts a note at the end of subsection 14(1) of the Act which references a new Division 10 to Part 2 (see section 30C inserted by Item 77 below) that provides the Regulator with an express power to later vary a determination of what components are taken to comprise a particular accredited power station.

Item 36 - After subsection 14(1)

42.     This item inserts a new subsection 14(1A) into the Act.  The purpose of this item is to provide that if the Regulator has provided a written notice under subsection 12B(1) of the Act, and if the Regulator is satisfied that the components of the power station specified in an application under section 13 of the Act are not materially different from the components specified in the provisional accreditation application, then the Regulator must determine that the components of the power station are taken to be a power station for the purposes of the Act.

Item 37 - Paragraph 14(2)(a)

43.     This item amends paragraph 14(2)(a) of the Act to improve the consistency of terminology used between different sections of the Act.

Item 38 - After subsection 14(2)

44.     This item inserts a new subsection 14(2A) into the Act.  The purpose of this item is to provide the Regulator with the flexibility to determine that components of an electricity generation system, for which accreditation is sought as a new power station, should be considered alternatively as an expansion or modification to an already-accredited power station.  This item prevents a person from being able to gain accreditation for a separate power station, of components that would more appropriately be considered under the Act to be part of another power station.   This item relies on the new section 30C (inserted by item 77 below), which empowers the Regulator to vary a decision establishing the boundaries of what constitutes a particular accredited power station, for effective operation. 

 



Item 39 - At the end of subsection 14(3)

 

45.     This item inserts a note at the end of subsection 14(3) of the Act.  The purpose of this item is to bring the attention of readers of the Act to a new Division 12 to Part 2 (see new section 30F inserted by item 77 below).

Item 40 - Subsection 14(4)

46.     This item removes redundant references in subsection 14(4) to guidelines prescribed in the Regulations.

Item 41 - At the end of section 15

47.     This item inserts a note at the end of section 15 of the Act.  The purpose of this item is to bring the attention of readers of the Act to a new Division 11 to Part 2 (see new sections 30D and 30E inserted by item 77 below) that provides grounds for suspending the accreditation of a power station.

Item 42 - After section 15

48.     This item inserts a new section 15A into the Act.  The purpose of this item is to specify the time within which the Regulator must determine accreditation applications.  If the Regulator has not made a decision within six weeks, or within such further period as agreed between the Regulator and the applicant, the Regulator is taken to have refused the application.

 

49.     This item also inserts a new section 15B into the Act which provides that the registered person who has applied successfully for accreditation of the components of an electricity generation system as an accredited power station becomes the nominated person for that accredited power station.

Item 43 - Section 17

50.     This item repeals section 17 in the Act and replaces it with a new section which clarifies what energy sources are eligible renewable energy sources and what are ineligible energy sources for the purposes of the Act by:

 

·          removing terms that are redundant and/or not sources, but rather processes or technologies for transforming energy sources into electricity; 

·          reordering the list of eligible renewable energy sources so that similar types of sources are grouped together. Examples include geothermal (aquifer and hot dry rocks), biomass (solid and wet wastes and gases sourced from various types of activity);

·          regrouping some of the various types of waste in a clearer manner; and

·          ensuring that materials or waste products that are made from fossil fuels or made from products, by-products or wastes from processing of fossil fuels, including where mixed in with any of the eligible renewable energy sources, are classified as ineligible renewable energy sources.

 

51.     This item also specifies that the regulations may prescribe any other eligible renewable energy source, allowing the Minister to recognise new and emerging eligible renewable energy sources.  In making regulations that determine the eligibility of new renewable energy sources, the Minister must be confident that the source is consistent with the objectives of the Act and the source does not contravene what is not an eligible renewable energy source as specified in the Act and Regulations. 

 

52.     This item also specifies those matters that may be prescribed in the Regulations made for the purposes of this Act, including:

·          defining the meaning of eligible renewable energy sources, and ineligible energy sources listed in the Act;

·          making provision for limiting the meaning of an eligible renewable energy source; and

·          extending the meaning of an ineligible energy source.

 

These provisions enable regulations to be made for the purposes of the Act to include requirements and conditions in defining the meanings of eligible renewable energy sources, and to prescribe the circumstances in which these conditions can be met in order for these renewable energy sources to be eligible under the Act.

Item 44 - Subsection 18(1)

53.     This item repeals subsection 18(1) of the Act and replaces it with a new subsection which clarifies that only the nominated person for an accredited power station may create renewable energy certificates for eligible electricity generation in respect of that accredited power station.

Item 45 - After subsection 18(1)

54.     This item inserts a new subsection 18(1A) into the Act.  The purpose of this item is to clarify the circumstances in which a renewable energy certificate should not be created.  

Item 46 - Subsection 18(2)

55.     This item repeals subsection 18(2) of the Act and replaces it with a new subsection.  The purpose of this item is to ensure that the terminology in subsection 18(2) is consistent with the new subsection 18(1) (see item 44 above), by clarifying that it is the nominated person for that accredited power station who may create the renewable energy certificate referred to in subsection 18(1).

 

Item 47 - Subsection 18(4)

56.     This item repeals subsection 18(4) of the Act and replaces it with a new subsection.  The purpose of this item is to clarify that electricity generated by a power station while its accreditation is suspended, or electricity that was generated using energy sources that are not eligible renewable energy sources, is not eligible to earn renewable energy certificates or to contribute towards meeting that power station’s 1997 eligible renewable power baseline.

Item 48 - At the end of section 18

57.     This item inserts a new subsection 18(5) at the end of section 18. The purpose of this item is to clarify that while the registration the nominated person for an accredited power station is suspended, that nominated person may not create any renewable energy certificates during that period of suspension.

Item 49 - Section 19

58.     This item repeals section 19 of the Act and replaces it with a new section 19.  The purpose of this item is to specify the time frame during which certificates may be created for the generation of electricity by specifying that a certificate may be created after generation of the electricity in relation to which the certificate is created and before the end of the year after the year of generation. For example, if electricity was generated in July 2005, the certificate relating to that generation would need to be created by the end of 2006.

Item 50 - Subsection 20(1)

59.     This item repeals subsection 20(1) of the Act and replaces it with a new subsection.  The effect of this item is to primarily make the timing requirements for submission of an electricity generation return (EGR) in relation to an accredited power station consistent with those for submission of liability and compliance related statements by liable entities under the Act.

 

60.     The new subsection 20(1) also clarifies who is responsible for submission of the EGR.  This item, together with item 44, ensures that both the authority to create renewable energy certificates and the responsibility to submit the EGR are vested in the same person, that is, the nominated person for the particular accredited power station.

Item 51 - Paragraph 20(2)(a)

61.     This item amends paragraph 20(2)(a) of the Act to clarify that electricity is generated by a power station, not a person, to ensure consistency with other provisions of the Act.

 

Item 52 - Paragraph 20(2)(c)

62.     This item inserts additional requirements that must be included in an electricity generation return to clearly distinguish, for tracking and checking purposes, the number of renewable energy certificates created in the reporting year from electricity generated in that year, and the number of renewable energy certificates created in that year from electricity generated in all preceding years.

Item 53 - After section 20

63.     This item inserts a new section 20A into the Act which enables electricity generation returns submitted in relation to an accredited power station to be amended either by the Regulator upon their own initiative or upon the written request of the nominated person for that accredited power station.  If the Regulator refuses a request by the nominated person to amend an electricity generation return, the Regulator must notify that nominated person accordingly.

Item 54 - Subsection 21(1)

64.     This item amends subsection 21(1) of the Act by removing the requirement that a solar water heater must displace non-renewable electricity to be eligible.

Item 55 - Subsection 21(2)

65.     This item repeals subsection 21(2) of the Act and replaces it with new subsections 21(2) and 21(3).  The purpose of new subsection 21(2) is to specify that certificates for a solar water heater may only be created within 12 months after the unit has been installed.



66.     New subsection 21(3) provides that regulations may be made in relation to the time at which a solar water heater is taken to have been installed.

Item 56 - Subsection 22

67.     This item is of a technical nature only, and is required as a consequence of item 57 below.

 

Item 57 - At the end of section 22

 

68.     Currently, before a new solar water heater model is able to earn renewable energy certificates for eligible installations, details of the new solar water heater, including the number of renewable energy certificates that may be created for eligible installations, must first appear in Schedule 7 of the Regulations.

 

69.     This item, together with new section 23AA (inserted by item 58 below), streamlines administration and shortens the time taken to enable new solar water heater models to be eligible to earn certificates under the Act by removing the need to amend the Regulations to include these new models.  Instead, the Regulator will be able to establish and maintain a register of eligible solar water heaters on the internet or elsewhere.



70.     The item also enables regulations to be made:

·          empowering the Regulator to make written determinations in relation to the number of renewable energy certificates able to be created for a particular solar water heater installation; and

·          requiring the Regulator to have regard to prescribed guidelines in making these determinations.

Item 58 - At the end of Subdivision B of Division 4 of Part 2

71.     This item inserts new section 23AA into the Act which enables the Regulations to make provision for the Regulator keeping a register of solar water heaters to effectively replace Schedule 7 of the Regulations, which would then become redundant.

Item 59 - Subsection 23A(1)

72.     This item removes an unintended restriction on the eligibility of installations of small-scale solar photovoltaic, wind or hydro electricity generation units that are not large enough to be classified under the Act as accredited power stations.  Accredited power stations using eligible renewable energy sources are not required to displace non-renewable electricity, thus the requirement that these so-called small generation units (SGUs) must do so is inconsistent with the intent of the Act, and is removed.

Item 60 - Subsection 23A(2)

73.     This item repeals subsection 23A(2) of the Act and replaces it with new subsections 23A(2) and 23A(3).  New subsection 23A(2) provides that regulations may be made in relation to the time at which a small generation unit is taken to have been installed.



74.     New subsection 23A(3) provides that regulations may be made in relation to the time when a ‘right’ to create certificates for small generation units arises and the period within which such certificates may be created in relation to a small generation unit.

Item 61 - Section 23B

75.     This item clarifies that certificates may be created in relation to a small generation unit rather than certificates being created for the installation of the unit.  This means that certificates may be created at different times during the life of the unit.

 

Item 62 - Subsection 23C(1)

76.     This item repeals subsection 23C(1) of the Act and replaces it with a new subsection to clarify that the owner of a small generation unit at the time that a right to create certificates arises in relation to the unit is entitled to create the certificates. 

Item 63 - Subsection 23C(2)

77.     This item provides that the regulations may specify how the owner of a small generation unit may assign the right to create certificates to another person. 

Item 64 - At the end of section 23C (2)

78.     This item inserts new subsections 23C(4) and 23C(5) into the Act.  The purpose of new subsection 23C(4) is to provide that the regulations may make provision in relation to when a right to create certificates in relation to a small generation unit may be assigned and to the kind of persons to whom the right may be assigned.

 

79.     New subsection 23C(5) clarifies that new subsection 23C(4) does not limit the regulations that may be made for the purposes of subsection 23C(2) of the Act.

Item 65 - At the end of section 23D

80.     This item clarifies that a person may create certificates for a small generation unit under Subdivision A (as a power station) if they elect not to create certificates under Subdivision BA (as a ‘deemed’ unit).

Item 66 - At the end of Subdivision BA of Division 4 of Part 2

81.     This item inserts a new section 23E into the Act.  The purpose of this new section is to provide that the owner of a small generation unit may elect, at the time it is installed, to create certificates for a small generation unit under Subdivision A (as a power station) or they may decide to create certificates under Subdivision BA (as a ‘deemed’ unit). 



82.     If the owner wishes to create certificates under Subdivision A (as a power station), the owner must advise the Regulator in writing within 28 days from the date of installation and before any certificates have been created. 



83.     If the owner makes an election to create certificates for the unit under Subdivision A (as a power station), then the person must not create certificates under Subdivision BA (as a ‘deemed’ unit) and the decision can not be varied or revoked.



84.     This item also provides that the regulations will prescribe the small generation units that qualify for this election process.

 

Item 67 - After Subdivision BA of Division 4 of Part 2

85.     This item inserts a new Subdivision BB (Solar water heater and small generation unit return), and inserts a new section 23F into the Act.  The purpose of this item is to provide that a person who creates more than 250 certificates in total under Subdivisions B (solar water heaters) and Subdivisions BA (small generation units) during a year, must give a return for the year to the Regulator before 14 February of the following year, or any later day allowed by the Regulator.



86.     The item also specifies the details that must be included in the return.

Item 68 - Subsections 24 (1) and (3)

87.     This item is of a technical nature only and reflects current drafting practices of not referring to ‘maximum penalty’ but instead referring to ‘penalty’ and relying on the Crimes Act 1914 to convert this to a maximum penalty.



Item 69 - Subsection 25 (1)

 

88.     This item clarifies that the certificates mentioned in this section relate to certificates created under Subdivision A of Division 4 (power stations) and amends the heading of section 25 to include ‘power stations’.

Item 70 - Paragraph 25(2)(b)

89.     This item clarifies that a renewable energy certificate must contain the electronic signature of the person who is registered under the Act to create the certificate, rather than the signature of an individual who physically enters the required data onto the Registry on behalf of the registered person.

Item 71 - Paragraph 25(2)(c)

90.     This item provides that, for administrative clarity, a renewable energy certificate is to contain the date on which the final part of the electricity in relation to that certificate was generated. 

Item 72 - After Paragraph 25(2)(c)

91.     This item inserts a new paragraph 25(2)(ca) to improve consistency between information required to be included as part of a renewable energy certificate, and information required to be included in the Register of Renewable Energy Certificates.

Item 73 - After section 25

92.     This item inserts a new subsection 25A into the Act that specifies the form and content of certificates created under Subdivision B (for solar water heaters) or Subdivision BA (for small generation units) of Division 4.  The item also specifies the information that each certificate is to contain.

Item 74 - Before section 29

93.     This item inserts a new subsection 28A into the Act that specifies that a registered owner of a certificate may surrender the certificate to the Regulator.  This means that the owner of the certificate may surrender the certificate even if the owner does not have a liability under other sections of the Act.

Item 75 - Subsection 29(1)

94.     This item clarifies that certificates surrendered under sections 28A, 44 or 95 of the Act are no longer valid.

Item 76 - After section 30

95.     This item inserts a new section 30A into the Act which specifies further grounds (additional to those specified in section 30 of the Act) enabling the Regulator to suspend the registration of a registered person. 

 

96.     Once created and registered, certificates cannot be revoked.  This new section enables the Regulator to act to more proactively manage the risk of renewable energy certificates being created contrary to the intent of the Act.

 

97.     New section 30A extends the grounds for suspending a person’s registration by allowing the Regulator to suspend the registration of a person in circumstances where the Regulator believes, on reasonable grounds, that:

·          the person has committed an offence against the Act or the Regulations; or

·          registration was obtained improperly.  An example of this is by supplying incorrect information as part of the application for registration. 

 

97.     This item also amends the heading to section 30 of the Act to clarify that the grounds for suspension outlined in that section relate to circumstances associated with the conviction of an offence.

Item 77 - At the end of Part 2

98.     This item inserts four new Divisions into the Act after Division 8 of Part 2.  These Divisions outline the processes relating to accredited power stations under the Act.

 

New Division 9-Changing the nominated person for an accredited power station.

 

99.     New section 30B, which is linked in its effect to new subsection 18(1) (inserted by item 44 above), establishes the process for changing the nominated person (defined in subsection 5(1) (see item 12 above)) for an accredited power station.  This provides flexibility for stakeholders (defined under subsection 5(1) (see item 22 above)) to be able to replace an existing nominated person to reflect changes in circumstances relating to the accredited power station, such as changes in ownership or operational control. 

 

       New Division 10-Varying what constitutes a power station

 

100.     Section 30C is linked to a new note in subsection 14(1) inserted by item 35, and addresses a current limitation in the legislation that there is no express power for the Regulator to vary what constitutes an accredited power station for the purposes of the Act to reflect changed circumstances or to correct an error.  Currently, it is possible to interpret the Act such that any equipment such as wind turbines that may be added to an existing wind farm, would require separate accreditation as a new power station.

 

101.     The new section 30C establishes a process allowing the Regulator to vary a determination for an accredited power station made pursuant to paragraph 14(1)(a) of the Act.  The new section also sets out the information that is to be included in an application to vary the components of an accredited power station, which includes a requirement for all stakeholders to agree in writing  to the changes proposed by the applicant.

 

New Division 11-Suspending the accreditation of a power station

 

102.     Two new sections have been included in this new Division to allow for the suspension of the accreditation of a power station in a number of circumstances.  The sections include references to new subsection 18(4) (inserted by item 47 above).

 

103.     New section 30D  provides the Regulator with a power to suspend the accreditation of a power station if satisfied that a gaming arrangement has occurred.  The concept of a gaming arrangement involves the co-ordination of power station electricity outputs to deliberately, without consideration of operational or restructural requirements, increase the number of renewable energy certificates that can be created in a year without equivalent increase in renewable energy generation.  Gaming has the potential to significantly dilute the effectiveness of the measure to stimulate the growth of the renewable energy industry and abate greenhouse gas emissions.

   

104.     New section 30D defines the meaning of a ‘gaming arrangement’ and specifies the conditions that must be present before the Regulator may consider suspending the accreditation of a power station. 

 

105.     New section 30D requires the Regulator to take into account information, including any matters prescribed in the regulations, that demonstrates that specified indicators of gaming were not the result of a gaming arrangement, in deciding on whether to suspend the accreditation of a power station. This means that the Regulator must have regard to any operational or industry restructuring factors when considering suspending the accreditation of a power station.

 

106.           New section 30E sets out two other circumstances where the Regulator may suspend the accreditation of a power station.  These are:

·          failure to provide an electricity generation return in accordance with

section 20 of the Act; or

·          belief on reasonable grounds that the power station is being operated in contravention of a Commonwealth, State or Territory law. 

 

107.         New section 30E also enables the Regulator to suspend accreditation in any other circumstances prescribed by the Regulations.  A note is included to clarify that renewable energy certificates may not be created from electricity generated by a power station while its accreditation is suspended, nor can this generation be counted as contributing towards meeting the 1997 eligible renewable power baseline for that power station.

 

New Division 12-Varying 1997 eligible renewable power baselines

 

108.           New section 30F addresses an inflexibility in the Act that prevents a 1997 baseline which has been set for an accredited power station from being subsequently amended.  This new section allows the Regulator to vary the 1997 baseline in the circumstances prescribed in the Regulations.  Decisions to vary 1997 eligible renewable power baselines are reviewable.

 

109.           New section 30F provides that if the Regulator increases the 1997 baseline for an accredited power station, it will only apply to years following the year in which the determination to increase the baseline was made.  If the Regulator reduces the 1997 baseline for an accredited power station it will apply to the year(s) specified in the determination.

Item 78 - At the end of paragraph 31(2)(c)

110.           This item provides that an acquisition of electricity by a person or body prescribed by regulations is not a relevant acquisition of electricity under the Act. The prescribed person or body is to undertake an independent market operator role similar to NEMMCO. 

Item 79 - Paragraph 32(1)(a)

111.           This item provides that a wholesale acquisition of electricity under the Act includes an acquisition of electricity from a person or body prescribed by regulations. The prescribed person or body is to undertake an independent market operator role similar to NEMMCO. 

Item 80 - Subsection 32(2)

112.           This item amends subsection 32(2) of the Act to improve the consistency of terminology used between different sections of the Act.

Item 81 - At the end of section 32

113.           Currently it is possible for more than one transaction in a set of transactions occurring in relation to supply of a particular quantum of electricity to be relevant acquisitions under sections 31 to 34 of Part 3 of the Act, and for a liability to arise under the Act in relation to each of those transactions.

 

114.           This item inserts a new subsection 32(3) into the Act which clarifies that if a set of transactions includes a transaction which is an acquisition from the National Electricity Market (NEM), then that acquisition will be the only acquisition that gives rise to a liability under the Act.  Any other acquisition in relation to that quantum of electricity will not be a relevant acquisition of electricity for the purposes of the Act, despite the operation of any of the other provisions of Part 3.

Item 82 - Subsection 33(2)

115.           This item is a consequential amendment required to reflect the fact that the recent National Electricity Reforms now refer to the ‘National Electricity Rules’, not the ‘National Electricity Code’. 

Item 83 - Subsection 33(2)

116.           This item amends subsection 33(2) of the Act to improve the consistency of terminology used between different sections of the Act.

Item 84 - Subsection 33(2A)

117.           This item repeals subsection 33(2A) which is rendered redundant by the new subsection inserted under item 81.

Item 85 - Subsection 33(3)

118.           This item amends subsection 33(3) of the Act to improve the consistency of terminology used between different sections of the Act.

Items 86 - Section 34

119.           This item clarifies that no acquisition of electricity by NEMMCO or a person or body prescribed in the regulations is a relevant acquisition of electricity under the Act. The prescribed person or body is to undertake an independent market operator role similar to NEMMCO.  This item also consequentially amends the heading to section 34.

 

Item 87 - Section 38

120.           This item amends section 38 of the Act to improve the consistency of terminology used  between different sections of the Act.

Item 88 - Paragraph 39(2)(b)

121.           This item repeals paragraph 39(2)(b) of the Act and replaces it with a new paragraph to clarify the meaning of terms used in a formula for calculating the default renewable power percentage for a year.

Item: 89 - After subsection 39(3)

122.           This item inserts a new subsection 39(3A) into the Act which provides the Minister with the flexibility, in determining the renewable power percentage (RPP) for a year, to consider an estimate of certain information in relation to eligible renewable electricity generated during previous years if the actual information is not available at the time of consideration by the Minister.

Item 90 - Section 40 (table, heading to column 2)

123.           This item clarifies that the gigawatt-hour column represents the total interim target for each year and not the additional generation that must be added to the previous year’s target.

Item 91 - At the end of section 41

124.           This item inserts a note at the end of section 41 of the Act making a reference to section 101 of the Act, which provides further details concerning a penalty charge to be paid in addition to a charge applicable under section 41.

Items 92 and 93 - Subsection 42(1) and Subsection 42(1)

125.           Currently, two different types of charge are covered by the term ‘additional renewable energy shortfall charge.’  To avoid confusion between these two distinct kinds of additional charge, and to prevent confusion with the renewable energy shortfall charge, this item separately identifies these two types of charge as ‘penalty charge’ applicable under Part 9, and ‘interest charge’ applicable under section 70 (see also items 15 and 7, respectively, for definitions of these terms).  Consequential amendments to other sections of the Act have also been made to reflect this change in terminology.

Item 94 - At the end of subsection 44(1)

126.           This item inserts a note at the end of subsection 44(1) of the Act which refers to new section 45A (inserted by item 102 below).

Item 95 - Paragraph 44(2)(c)

127.           This item clarifies that a annual energy acquisition statement must include the megawatt hour value of certificates being surrendered under section 44.

Item 96 - Subsection 44(4)

128.           This item amends subsection 44(4) of the Act to improve the consistency of terminology used within section 44.

Item 97 - Subsection 44(4)

129.           This item clarifies that the surrender of certificates referred to in subsection 44(4) relates to the surrender of certificates under section 44.

Item 98 - Subsection 44(4)

130.           This item amends subsection 44(4) of the Act to improve the consistency of terminology between different sections of the Act.

Item 99 - Subsection 44(4)

131.           This item amends subsection 44(4) of the Act to improve the consistency of terminology used within the subsection.

Item 100 - Subsection 44(5)

132.           This item repeals subsection 44(5) of the Act and substitutes it with new subsections 44(5), 44(6), 44(7), 44(8) and 44(9).  The purpose of this item is to allow liable entities to pay a fee for the surrender of renewable energy certificates within a period of 28 days from the entity receiving a notice from the Regulator following lodgment of an energy acquisition statement.  The purpose of the Regulator’s notice is to advise the number of certificates that are able to be surrendered for that year and the fee payable in respect of the surrender of those certificates.  Where the fee is not paid within 28 days of receipt of the Regulator’s notice, this becomes a debt payable to the Commonwealth and is recoverable by the Regulator in a court of competent jurisdiction.

Item 101 - Section 45

133.           This item clarifies that the restrictions on certificates that can be surrendered as outlined in section 45 relates to the surrender of certificates under section 44.

 

Item 102 - After section 45

134.           This item inserts a new section 45A into the Act.  New section 45A enables the Regulator to amend an energy acquisition statement (EAS) on their own initiative or on the application of the liable entity.  The Regulator is to notify the liable entity of a decision to amend an EAS and a decision to amend or to refuse to amend an EAS will be reviewable.  Amending an EAS may also require the Regulator to issue a default assessment under section 48 or amend an assessment under section 49.

Item 103 - Paragraphs 46(2)(d) and (e)

135.           This item repeals paragraphs 46(2)(d) and (e) of the Act and replaces those paragraphs with a new paragraph 46(2)(d) which clarifies that a liable entity may have a carried forward shortfall for a year or a renewable energy shortfall charge for the year, but not both.

Item 104 - Paragraph 47(c)

136.           This item reflects the fact that in some circumstances, when lodging a renewable energy shortfall statement, no charge may be payable.

Item 105 - Paragraph 47(e)

137.           This item repeals paragraph 47(e) of the Act and replaces it with new paragraphs 47(e) and (ea) which improve on current reporting arrangements by ensuring that all renewable energy certificate shortfalls for a year are identified in a liable entity’s first renewable energy shortfall statement for that year, even if the shortfall is less than ten percent (10%) and a renewable energy shortfall charge is not payable.

Item 106 - Paragraph 48(1)(b)

138.           This item strengthens reporting arrangements relating to total liabilities by allowing the Regulator to make a default assessment for any liable entity that the Regulator believes has a renewable energy certificate shortfall for the year, and it has not lodged a renewable energy shortfall statement. 

Item 107 - Subsection 48(1)

139.      This item reflects the fact that in some circumstances no charge may be payable in relation to a liable entity’s renewable energy certificate shortfall for the year.

Item 108 - Paragraph 48(2)(c)

140.      Similar to item 106 above, this item strengthens reporting arrangements relating to total liabilities by allowing the Regulator to make a default assessment for any liable entity in circumstances where the Regulator believes that the liable entity has a renewable energy certificate shortfall for the year, and it has not lodged a renewable energy shortfall statement or an energy acquisition statement.

Item 109 - Subsection 48(2)

141.      This item reflects the fact that in some circumstances no charge may be payable in relation to a liable entity’s renewable energy certificate shortfall for the year.

Item 110 - At the end of subsection 49(1)

142.      To avoid confusion, this item inserts a note to clarify that where the Regulator has made an assessment of the penalty charge owed by a liable entity (see Part 9 of the Act), then the liable entity may not apply to the Regulator to amend an assessment conducted by the Regulator under this Division (Division 2 of Part 5 of the Act).  If the liable entity wishes to dispute the penalty charge imposed, then it can apply for a review of that decision under subsection 66(l) of the Act.

Item 111 - Subsection 49(3)

143.      This item clarifies that it is possible for the Regulator to amend an assessment with a view to reducing a liable entity’s liability beyond the four year time period allowed where:

·          the liable entity has applied for the assessment to be amended within 4 years from the day that the renewable energy shortfall charge became payable; and

·          within that four year period the liable entity lodges all information the Regulator needs to decide the application.

Item 112 - Paragraph 49(6)(a)

106.     This item is of a technical nature only to rectify a grammatical error.

Item 113 - Paragraph 49(6)(b)

107.     This item is of a technical nature only to rectify a grammatical error.

Item 114 - Subsection 50(2) (definition of overpaid amount )

108.           Currently two different types of charge are covered by the term ‘additional renewable energy shortfall charge.’  To avoid confusion between these two distinct kinds of additional charge, and to prevent confusion with the renewable energy shortfall charge, this item separately identifies these two types of charge as ‘penalty charge’ applicable under Part 9, and ‘interest charge’ applicable under section 70 (see also items 15 and 7, respectively, for definitions of these terms).  Consequential amendments to other sections of the Act have also been made to reflect this change in terminology.

Item 115 - Section 52

109.           This item amends section 52 of the Act to improve the consistency of terminology used between different sections of the Act.

Item 116 - At the end of Part 5

110.           This item inserts a new section 53A into the Act which clarifies that a liable party that has received an assessment of a penalty charge cannot apply to have that assessment amended under Division 2 of Part 5 of the Act.

Item 117 - Section 54

111.           This item is of a technical nature only and amends section 54 of the Act as a consequence of item 118 below.

Item 118 - At the end of section 54

112.           This item inserts a new subsection 54(2) into the Act which clarifies that if a liable party has received an assessment of a penalty charge under section 102 of the Act, the liable party cannot object to that assessment under the provisions of this Division.  If the liable entity wishes to dispute the penalty charge, then it can apply for a  review of that decision under subsection 66(l).

Item 119 - Section 55

113.           This item amends section 55 of the Act to improve the consistency of terminology used in Part 6 of the Act. 

Item 120 - Subsection 57(2)

114.           This item amends subsection 57(2) of the Act to improve the consistency of terminology used in Part 6 of the Act.  This item also amends the heading to section 57 to clarify the requirement in this section that the liable entity must make a written request to the Regulator to deal with an objection.

Item 121 - Subsection 57(4)

115.           This item amends subsection 57(4) of the Act to improve the consistency of terminology used in Part 6 of the Act.

Item 122 - Subsection 57(6)

116.           This item amends subsection 57(6) of the Act to improve the consistency of terminology used in Part 6 of the Act.

Item 123 - Subsection 58(3)

117.           This item amends subsection 58(3) of the Act to improve the consistency of terminology used in Part 6 of the Act.

Item 124 - Section 62

118.           This item amends section 62 of the Act to improve the consistency of terminology used in Part 6 of the Act.

Item 125 - Section 65

119.           This item amends section 65 to clarify that the additional renewable shortfall charge is now termed as either a penalty charge or an interest charge.

Item 126 - Subsection 66(1) (after table item 1)

120.           This item inserts a new item 1A in the Table in subsection 66(1) of the Act to clarify that a decision of the Regulator in relation to an application for the provisional accreditation of a power station is a reviewable decision.

Item 127 - Subsection 66(1) (after table item 3)

121.           This item inserts a new item 3A in the Table in subsection 66(1) of the Act to clarify that a decision of the Regulator to amend or to refuse to amend an electricity generation return is a reviewable decision.

Item 128 - Subsection 66(1) (table item 5)

122.           This item includes a reference to section 30A in item 5 of the table to subsection 66(1) to clarify that a decision of the Regulator made under that section is a reviewable decision.

Item 129 - Subsection 66(1) (after table item 5)

123.           This item inserts new items 5A to 5E in the table to subsection 66(1) of the Act to clarify that decisions of the Regulator under new sections 30B, 30C, 30D, 30E and section 30F (see item 77 above), and a decision of the Regulator under new section 45A (see item 102 above) are reviewable decisions.

Items 130 and 131 - Subsection 66(1) (table item 6), and Subsection 66(1) (table item 7)

124.           Currently two different types of charge are covered by the term ‘additional renewable energy shortfall charge.’  To avoid confusion between these two distinct kinds of additional charge, and to prevent confusion with the renewable energy shortfall charge, these items separately identify these two types of charge as ‘penalty charge’ applicable under Part 9, and ‘interest charge’ applicable under section 70 (see also items 15 and 7, respectively, for definitions of these terms).  Consequential amendments to other sections of the Act have also been made to reflect this change in terminology.

Item 132 - Part 7 (heading)

125.           This item is of a technical nature only and deletes the term ‘refunding’ from the heading to this Part because the provisions of this Part only deal with collection and recovery of charges.

Item 133 - Section 68

126.           This item amends section 68 of the Act to improve the consistency of terminology used in Part 7 of the Act.

Item 134 - Section 68

127.           This item replaces the reference to ‘the additional charge’ with a reference to ‘that charge’ in section 68 to clarify that this term refers to the penalty charge.

Item 135 - Section 70

128.           This item repeals section 70 and replaces it with a new section to  clarify that an interest charge, by way of penalty, is payable in relation to the whole of the unpaid renewable energy shortfall charge and the whole of the unpaid penalty charge.  The interest charge for a day becomes due and payable at the end of the day.

Item 136 - Subsection 81(1)

129.           This item repeals subsection 81(1) and replaces it with a new subsection.  The current subsection 81(1) is too broad and could apply to any receivers and principals.  The new subsection narrows the application to only those receivers, or receivers and managers, that take possession of a company’s assets for the company’s debenture holders, and the company is, or has been, a liable entity under the Act.

Item 137 - Section 82

130.           This item is of a technical nature only and reflects current drafting practices of not referring to ‘maximum penalty’ but instead referring to ‘penalty’ and relying on the Crimes Act 1914 to convert this to a maximum penalty.

 

Item 138 - At the end of subsection 85(1)

131.           This item inserts a new paragraph 85(1)(c) into the Act which limits the application of Subdivision D of Division 2 of Part 7 so it only applies to agents whose principal is, or has been, a liable entity under the Act.

Item 139 - Section 86

132.           This item is of a technical nature only and reflects current drafting practices of not referring to ‘maximum penalty’ but instead referring to ‘penalty’ and relying on the Crimes Act 1914 to convert this to a maximum penalty.

Item 140 - Paragraph 89(3)(a)

133.           This item omits the word ‘return’ and substitutes it with the word ‘statement’ to clarify the type of information that a trustee has to provide in circumstances where the Regulator is recovering a charge from a deceased person’s estate. 

Item 141 - Paragraph 89(3)(b)

134.           This item omits the redundant term ‘additional returns’ from paragraph 89(3)(b).

Item 142 - Paragraph 89(4)(b)

135.           This item omits the word ‘return’ and substitutes it with the word ‘statement’ to clarify that if the trustee fails to provide a statement, the Regulator may proceed with assessing the liability.

Item 143  - Subsection 95(2)

136.           This item amends subsection 95(2) of the Act to improve the consistency of terminology used between different sections of the Act.

Item 144 - Subsection 96(2)

137.           This item clarifies that the amount of renewable energy shortfall charge referred to in subsection 96(2) is the amount which was paid by the liable entity.

Items 145, 146, 147, 148, 149, 150, 151 and 152 - Subsection 99(1), Subsection 99(2), Subsection 99(3), Subsection 99(4), Subsection 100(1), Section 101, Subsection 102(1) and Section 103

138.           Currently two different types of charge are covered by the term ‘additional renewable energy shortfall charge.’  To avoid confusion between these two distinct kinds of additional charge, and to prevent confusion with the renewable energy shortfall charge, these items separately identify these two types of charge as ‘penalty charge’ applicable under Part 9, and ‘interest charge’ applicable under section 70 (see also items 15 and 7, respectively, for definitions of these terms).  Consequential amendments to other sections of the Act have also been made to reflect this change in terminology.

Item 153 - After subsection 107(1)

139.           This item inserts a new subsection 107(1A) into the Act which allows the Regulator to appoint, as authorised officers, other persons appointed or employed by the Commonwealth, State or Territory so that there is a larger pool of people the Regulator may draw on to assist with auditing tasks.

Item 154 - Section 109

140.           This item is of a technical nature only and reflects current drafting practices of not referring to ‘maximum penalty’ but instead referring to ‘penalty’ and relying on the Crimes Act 1914 to convert this to a maximum penalty.

Item 155 - Subsection 110(1)

141.           This item amends subsection 110(1) of the Act to extend the monitoring powers of an authorised officer to enable the officer to enter premises to determine whether the Act or the Regulations have been complied with.  As information is also provided by liable entities in accordance with the Regulations, it is necessary that the monitoring provisions be extended so that authorised officers can substantiate such information.

Item 156 - Paragraph 111(1)(b)

142.           This item amends paragraph 111(1)(b) of the Act to insert the words ‘ or the regulations’ to ensure that an authorised officer has the power to examine any activity conducted on the premises that may relate to information provided for the purposes of complying with the Act or the Regulations. 

Item 157 - Paragraph 111(1)(c)

143.           This item amends paragraph 111(1)(c) of the Act to insert the words ‘ or the regulations’ to ensure that an authorised officer has the power to examine any thing on the premises that may relate to information provided for the purposes of complying with the Act or the Regulations.

Item 158 - Paragraph 111(1)(e)

144.           This item amends paragraph 111(1)(e) of the Act to insert the words ‘ or the regulations’ to ensure that an authorised officer has the power to inspect any document on the premises that may relate to information provided for the purposes of complying with the Act or the Regulations.

Item 159 - Subparagraph 111(1)(h)(iii)

145.     This item is of a technical nature only to correct a grammatical error.

Item 160 - Subsection 111(2)

146.           This item amends subsection 111(2) to clarify that the use of the term ‘monitoring powers’ in Part 11 of the Act includes using those powers for the purposes of substantiating information provided under the Regulations as well as information provided under the Act. 

Item 161 - Paragraph 112(1)(a)

147.           This item amends paragraph 112(1)(a) to insert the words ‘ or the regulations’ to ensure that when an authorised officer has entered premises with the consent of the occupier, the authorised officer may request the occupier to answer any questions related to the provision of information under the Act or the Regulations.

Item 162 - Paragraph 112(2)(a)

148.           This item amends paragraph 112(2)(a) to insert the words ‘ or the regulations’ to ensure that where an authorised officer has entered premises by authority of a monitoring warrant, the authorised officer may require the occupier to answer any questions related to the provision of information under the Act or the Regulations.

Item 163 - Subsection 113(1)

149.           This item is of a technical nature only and reflects current drafting practices of not referring to ‘maximum penalty’ but instead referring to ‘penalty’ and relying on the Crimes Act 1914 to convert this to a maximum penalty.

Item 164 - Sections 114 and 115

150.           Section 114 makes it an offence for a person to provide false or misleading evidence, and section 115 makes it an offence for a person to provide false or misleading documents.  This item repeals sections 114 and 115 as they are no longer necessary having regard to section 137.1 of the Criminal Code which applies to false or misleading information and section 137.2 of the Criminal Code which applies to false or misleading documents.

Item 165 - Subsection 119(1)

151.           This item replaces ‘premises in respect of which it is being executed’ with ‘warrant premises’ to simplify the language used subsection 119(1) and to ensure consistency with the definition of warrant premises as defined in subsection 5(1) of the Act.

Item 166 - Paragraph 120(2)(a)

152.           This item amends paragraph 120(2)(a) of the Act to extend the monitoring provisions so that authorised officers can operate electronic equipment already at premises to substantiate information provided under the Act or the Regulations.

Item 167 - Section 124

153.           This item is of a technical nature only and reflects current drafting practices of not referring to ‘maximum penalty’ but instead referring to ‘penalty’ and relying on the Crimes Act 1914 to convert this to a maximum penalty.

Item 168 - Subsection 125(2)

154.           This item amends subsection 125(2) of the Act to enable a magistrate to issue a monitoring warrant to allow authorised officers access to premises to substantiate information provided under the Act or Regulations to determine whether the Act or Regulations have been complied with.

Item 169 - After Part 11

155.           Currently, information-gathering powers under the Act are restricted to authorised officers, and may only be exercised when premises have been entered.  This item adds a new Part 11A (Information-gathering powers) and comprises sections 125A to 125F which provide the Regulator with new information-gathering powers consistent with those contained in other Commonwealth legislation such as the Textile, Clothing and Footwear Strategic Program Act 1999 and the Diesel and Alternative Fuel Grants Scheme Act 1999

 

156.           New section 125A provides that under certain circumstances, the Regulator is empowered to require a person to give information and evidence and produce documents relevant to the operation of the Act.  This section also requires that the Regulator give written notice to the person when exercising its powers under this section, and sets out the information that this notice must contain.  This section also creates an offence for failure by the person to comply with a notice provided by the Regulator under new subsection 125A(2).  The maximum penalty for a contravention of this provision is 20 penalty units (one penalty unit is equivalent to $110 (see section 4AA of the Crimes Act 1914 )).

 

157.           New section 125B provides that an individual is not excused from providing information, evidence or documentation under new Part11A on the grounds of self-incrimination, or of exposure of the individual to a penalty.   However, the section also sets limits on the circumstances under which this information, evidence or documentation, or anything deriving from it can be used in evidence against the individual in criminal proceedings.

 

158.           New section 125C provides the Regulator with powers in relation to inspecting, copying and taking extracts of documents produced under new Part 11A.

 

159.           New section 125D  sets out powers and responsibilities of the Regulator in relation to possession of a document produced under new Part11A, and the entitlements of a person otherwise entitled to possession of the document.

 

160.           New section 125E sets out the grounds on which a person is guilty of an offence of providing false and misleading evidence in relation to new section 125A, and sets a maximum penalty of 12 months imprisonment for this offence.

Item 170 - Paragraph 126(1)(b)

161.           The Regulator is head of a statutory agency called the Office of the Renewable Energy Regulator (see section 151 of the Act).  This item substitutes paragraph 126(1)(b) of the Act with a new paragraph to clarify that the secrecy provisions of Part 12 of the Act apply to the staff of the Office of the Renewable Energy Regulator.

Item 171 - Subsection 127(1)

162.           This item is of a technical nature only and reflects current drafting practices of not referring to ‘maximum penalty’ but instead referring to ‘penalty’ and relying on the Crimes Act 1914 to convert this to a maximum penalty.

Item 172 - Section 128

163.           This item  amends section 128 of the Act to clarify the meaning of this section and enable disclosure of protected information or production of protected documents to a court in the course of a criminal investigation under the Act.

Item 173 - Subsection 130(1)

164.           This item amends subsection 130(1) of the Act to clarify the meaning of this subsection and to allow the Regulator, or a person authorised by the Regulator, to divulge information obtained, or produce in court a document obtained under or for the purposes of the Act, where necessary to do so for the purpose of the Act.

Item 174 - Paragraph 132(1)(b)

165.           This item clarifies that protected information can be divulged by the Regulator, or a person authorised by the Regulator, to the Administrative Appeals Tribunal with respect to proceedings under the Act only.

 

Item 175 - After paragraph 134(a)

166.           This item inserts a new paragraph (aa) into section 134 of the Act which clarifies the type of information that the Regulator may publish relating to a liable entity’s renewable energy certificate.

Item 176 - Paragraph 134(b)

167.           This item is of a minor technical nature required to specify that the Regulator may publish total renewable energy certificate shortfalls in relation to a particular year.

Item 177 - Paragraph 138(b)

168.           This item amends paragraph 138(b) to clarify that the name of the ‘nominated person’ for the accredited power station is to be included in the register of accredited power stations. 

Item 178 - After paragraph 138(c)

169.           This item inserts a new paragraph 138(ca) into the Act specifying additional information relating to the 1997 eligible renewable power baseline for each power station (including any variations that may be made to the baselines under section 30F (inserted by item 77 above)) must also be included on the register of accredited power stations.

Item 179 - Paragraph 140(a)

170.           This item clarifies that the number that appears on renewable energy certificates is a unique identification code (see section 25 of the Act).

Item 180 - Paragraph 140(da)

171.           This item clarifies that the ‘register of renewable energy certificates’ should include the eligible renewable energy source(s) in respect of which the certificate was created.

Item 181 - Paragraph 141A(b)

172.           This item clarifies that the contents of the register of applications for accredited power stations is to include the location of the power station

Item 182 - Paragraph 141A(d)

173.           This item is of a technical nature only to correct a typographical error in the Act.

Item 183 - At the end of subsection 147(3)

174.           This item inserts a new paragraph 147(3)(e) into the Act which allows the Minister to terminate the appointment of the Regulator if the Regulator, without reasonable excuse, fails to notify the Minister of any conflicts of interest.

Item 184 - After section 147

175.           This item inserts a new section 147A into the Act which provides that the Regulator must give the Minister written notice of all interests, pecuniary or otherwise, that could conflict with the proper performance of the Regulator’s functions.

Item 185 - Subsection 148(3)

176.           This item amends subsection 148(3) of the Act to remove a redundant reference to the Consolidated Revenue Fund.  Section 157 of the Act clarifies that all payments under this Act are to be made out of the Consolidated Revenue Fund.

Item 186 - Part 15 (heading)

177.           This item substitutes the heading to Part 15 and replaces it with a new heading to clarify that the offences under Part 15 relate to the failure to provide documents.

Item 187 - Sections 152 and 153

178.           This item repeals sections 152 and 153 because there is no longer a need for the Act to specify the application of the Criminal Code and the relevant sections of the Criminal Code relating to the giving of false or misleading evidence or documents.

Item 188 - Subsections 154(1) and (3)

179.           This item is of a technical nature only and reflects current drafting practices of not referring to ‘maximum penalty’ but instead referring to ‘penalty’ and relying on the Crimes Act 1914 to convert this to a maximum penalty.

Item 189 - Subsection 160(1)

180.           This item is of a technical nature only and corrects a typographical error in the Act.

Item 190 - Subsection 161(1)

181.           This item is of a technical nature only and is required as a consequence of item 191 below.

Item 191 - Subsection 161(2)

182.           This item repeals subsection 161(2) of the Act which will expedite the regulation making process by removing the requirement for draft new or amended regulations to be made available for public comment for 30 days before they are made. 

P art 2 - Application, saving and transitional provisions

Item 192 - Application - assessments

183.           This item provides that a review under the Administrative Decisions (Judicial Review) Act 1977 of the assessment-related decisions under the Act that are detailed in item 1, only applies in relation to decisions made after the commencement of item 1.

Item 193 - Application - creation of renewable energy certificates

184.           This item clarifies that the amendments made by items 4, 44, 45, 46, 69, 70, 71, 72, 73, 179 and 180 relating to the creation of renewable energy certificates only apply to renewable energy certificates created after the commencement of those items. 

Item 194 - Application - charges

185.           This item clarifies that the amendments made by items 7, 15, 19, 114, 125, 130, 131, 133, 134, 135 and 145 to 152 relating to the amounts that a liable entity becomes liable to pay only apply to amounts that become liable for payment after the commencement of those items.

Item 195 - Application - applications for accreditation of a power station

186.           This item clarifies that the amendments made by the items 30, 31, 32, 34, 38 and 181 relating to applications for accreditation of a power station only apply for applications made after the commencement of those items.

Item 196 - Application - time limit for deciding applications

187.           This item clarifies that the amendment made by item 42 relating to time limits for deciding applications for accreditation of power stations applies to applications made after the commencement of that item.

 



Item 197 - Application - electricity generation

188.           This item clarifies that the amendments made by items 43 and 49 relating to electricity generated only apply in relation to electricity generated after the commencement of those items.

Item 198 - Transitional - electricity generated before commencement

189.           This item provides a transitional arrangement in relation to when certificates for electricity generated before this item commences must be created.  For electricity generated before this item commences, certificates can not be created after the year following the year this item commences. For example, if this item commences on 1 July 2006, and electricity has been generated prior to that date, then the certificates for that electricity generation must be created before 31 December 2007.

Item 199 - Application - solar water heaters and small generation units

190.           This item sets out the applications arrangements that will apply with respect to solar water heaters and small generation units by clarifying that:

·          the amendments made by items 54, 55, 57 and 58 apply in relation to solar water heaters installed after the commencement of those items;

·          the amendments made by items 59, 60 (in so far as it inserts subsection 23A(2) of the Act), 65 and 66 apply in relation to small generation units installed after the commencement of those items;

·          the amendments made by items 60 (in so far as it inserts subsection 23A(3) of the Act), 61 and 62 apply in relation to small generation units installed before or after the commencement of those items;

·          the amendments made by items 63 and 64 apply in relation to assignments made after the commencement of those items in relation to small generation units installed before or after that commencement; and

·          the amendment made by item 67 applies in relation to years ending after the commencement of that item.

 

Item 200 - Application - surrender of certificates

 

191.           This item provides that the amendments made by item 74 relating to the surrender of certificates applies to certificates created before or after commencement of that item.

Item 201 - Application - relevant acquisitions of electricity

192.           This item provides that the amendments made by items 81 and 84 apply to remove a potential double liability in relation to acquisitions of electricity occurring from the year commencing 1 January 2006 onwards.

Item 202 - Saving - fees for surrender of certificates

193.           This item clarifies that regulations in force for the purposes of subsection 44(5) of the Act immediately before the commencement of this item have effect after the commencement of this item as if they were regulations made for the purposes of that subsection after that commencement.

Item 203 - Application - secrecy

194.           This item provides that the amendments made by items 172, 173 and 174 apply in relation to proceedings instituted after the commencement of these items.

Item 204 - Application - publication

195.           This item provides that the amendment made by item 175 in relation to publishing certain matters apply in relation to years ending after the commencement of that item.

Item 205 - Application - register of accredited power stations

196.           This item provides that the amendment made by item 178 applies in relation to power stations accredited before or after the commencement of that item.

Item 206 - Transitional - accredited power stations

197.           Because there are already a number of existing accredited power stations, it is necessary to introduce some transitional arrangements which are inserted by this item.  The transitional arrangements that will apply in relation to an accredited power station that was accredited under Division 3 of Part 2 of the Act before the commencement of this item include:

·          giving the Regulator a period of 28 days to approve, in writing, a nominated person for each existing accredited power station.  In this regard it should be noted that the approved person must be a stakeholder in the accredited power station;

·          providing a definition of stakeholder for the purposes of this item; and

·          clarifying that the Regulator’s decision on this matter is reviewable.  This means that any other stakeholder in relation to that accredited power station who has not been approved as the ‘nominated person’ may request the Regulator to review this decision.

Item 207 - Transitional - relevant acquisitions of electricity

198.           This transitional provision and the application provision under item 201 do not change the liability of an entity that has made a wholesale or notional wholesale acquisition of electricity in the years 2001 to 2005 (the applicable year). 



199.           However, if, after the application of this item, an entity  which would not have incurred a liability if the amendments under items 81 and 84 had applied to acquisitions for the applicable year, and now have a carried forward surplus at the end of the applicable year, the entity, or person, may write to the Regulator requesting a reduction in the carried forward surplus and a reduction to the renewable energy certificate shortfall of another person for the applicable year by the corresponding amount.

 




[1] Tambling Report, p.17