Under the Renewable Energy Target, relevant acquisitions refer to the purchase of electricity made by a company. Companies who are liable under the Renewable Energy Target must report all relevant acquisitions they make on an annual basis—through the submission of an energy acquisition statement or renewable energy shortfall statement. In some instances, liable entities may be exempt from reporting relevant acquisitions. If certain conditions are met, this could mean that an entire electricity network (grid) could be exempt from reporting.
There are two types of relevant acquisitions: wholesale acquisitions or notional wholesale acquisitions.
Under section 32 of the
Renewable Energy (Electricity) Act 2000, wholesale acquisitions include purchases of electricity:
Wholesale acquisitions do not apply as a relevant acquisition when the end user has acquired electricity directly from the person who generated it. In this case a notional wholesale acquisition would apply.
If a purchase of electricity has been identified as a wholesale acquisition, then no other types of acquisitions can apply.
Renewable Energy (Electricity) Act 2000 , notional wholesale acquisitions are purchases of electricity made by the same legal entity where they:
Section 33 of the Act prescribes two situations where a notional wholesale acquisition of electricity takes place:
In both cases, the person who generated the electricity acts as both the notional generator and the notional wholesaler. This means that the notional wholesaler acquired the electricity from the notional generator at the time that the end user acquired the electricity.
Renewable Energy (Electricity) Regulations 2001 (the Regulations), liable entities typically calculate the amount of acquired electricity for all relevant acquisitions at the:
Under regulation 21 of the Regulations, the amount of acquired electricity is calculated in one of several ways, if the electricity is:
If (a) to (d) above does not apply, liable entities are required to use a method of calculation to be chosen by the Clean Energy Regulator after consultation with the liable entity using the amount of metered or calculated electricity:
Liable entities may be exempt when they are both the liable entity and legal entity, and:
Section 31(2) of the
Renewable Energy (Electricity) Act 2000 prescribes that an acquisition is not a relevant acquisition if:
For some networks (grids) relevant acquisitions do not apply. This includes if:
For more information refer section 31(2)(a) and section 31(3)
Renewable Energy (Electricity) Act 2000 .
Renewable Energy (Electricity) Regulations 2001 , regulation 22 defines the capacity of a grid as the sum of all installed electricity generation capacity, excluding:
A person who owns, operates or controls a grid must also provide the Clean Energy Regulator a statement within 28 days of the following changes:
New business models for photovoltaic (PV) systems ownership are growing. These models, which including lease arrangements, were not envisaged when the Renewable Energy Target was established. The new business models require careful assessment to determine how liability is to be determined under the Renewable Energy Target. This guidance outlines the Clean Energy Regulator’s approach to the issue, both in terms of how liability is to be reported in the short term and how longer term options may be pursued.
In traditional model small-scale photovoltaic systems, an owner of solar panels generates electricity, some of which is used directly by the owner and the remainder is exported to the grid. Their electricity retailer then has liability under the Renewable Energy Target for the portion exported to the grid, as they make a ‘wholesale acquisition’ of electricity under the
Renewable Energy (Electricity) Act 2000. The owner of the solar panels does not have a Renewable Energy Target liability for their self-consumption behind the meter.
New business models generally involve a home or business owner leasing solar panels from a company under a contract. The terms of those contracts may have an impact on the point of liability and who has a Renewable Energy Target liability. In some circumstances, contractual arrangements could result in both behind the meter consumption and the amount fed into the grid being liable. However, there does not appear to be consistency across the market in relation to how these matters (including potential RET liability) are explained to home and business owners. Similarly, there does not appear to be a uniform approach to the contractual terms. Therefore, there is not a ‘one-size-fits-all’ outcome.
As these contracts are a matter between the parties, the Clean Energy Regulator’s position is that it is the responsibility of the entities who offer these contracts to home and business owners, and the retailers who acquire relevant electricity, to carefully consider the point of liability, properly inform home and business owners, and report acquisitions appropriately.
The default position is that electricity retailers should continue to report all liable electricity acquired consistent with the traditional model outlined above in their energy acquisition statements; including any excess exported into the grid from behind the meter solar PV systems of their household and business customers.
Should the retailer be aware of contractual arrangements that it believes does not make it liable for the export to the grid, and not wish to report and acquit those acquisitions, then it must provide full details of each specific case to the Clean Energy Regulator in order to justify why it has not reported those acquisitions.
The Clean Energy Regulator will review this guidance and the underlying position if it becomes aware of information that substantially affects the operation of the scheme or December 2018, whichever occurs first.
New business models are continuing to grow, including peer-to-peer trading and the use of blockchain for settlement.
The agency is continuing discussions with the Department of the Environment and Energy regarding potential legislative amendments to clarify liability under the Renewable Energy Target for new and emerging business models.
The installation of battery storage systems is increasing across Australia and market participants need to be aware of their Renewable Energy Target responsibilities, including whether or not they may become liable entities. This guidance clarifies liability under the Renewable Energy Target for battery storage systems that import electricity from the transmission or distribution networks, or directly from the generator, and later export electricity back to the grid.
There are two principles in the
Renewable Energy (Electricity) Act 2000 that are relevant when considering Renewable Energy Target liability for battery storage systems:
The Clean Energy Regulator takes the following interim position regarding liability for battery storage systems:
Battery storage system owners must ensure that appropriate metering exists and records are maintained. This guidance can also be used for most other energy storage technologies including pumped hydro energy storage. For further information, please contact us.
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