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Office of the Renewable Energy Regulator

Increasing Australia's renewable electricity generation

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Legislation

Framework

The Office of the Renewable Energy Regulator (ORER) administers the Renewable Energy (Electricity) Act 2000 (the Act), Renewable Energy (Electricity) Charge 2000 and the Renewable Energy (Electricity) Regulations 2001 (the regulations) to increase renewable electricity generation from Australia's renewable energy sources by encouraging the generation of an additional 45,000 GWh of renewable energy per year by 2020.

The Renewable Energy Target (RET) applies nationally, with the majority of electricity retailers and wholesale electricity buyers on liable grids in all States and Territories contributing proportionately to increase Australia's renewable energy sources.

RET operates by imposing a legal liability to support renewable energy electricity generation on, generally, large wholesale purchasers of electricity. An example of a liable party under the legislation would be an electricity retailer purchasing wholesale electricity to meet retail sale obligations to customers (acquisitions of electricity). The liable parties are directly responsible for supporting an increase in the amount of electricity generated from renewable energy sources, which is implemented through the surrender of renewable energy certificates (RECs) in proportion to their acquisitions of electricity.

Legislation

RET is implemented through the following legislation:

• Renewable Energy (Electricity) Act 2000  - No. 174, 2000 (taking into account amendments of the Renewable Energy (Electricity) Amendment Act - No. 90, 2006, No. 26 2008, No. 73 2008, No. 17, 2009, No. 78, 2009)
• Renewable Energy (Electricity) (Charge) Act 2000  - No. 129, 2000 (taking into account amendments of the Renewable Energy (Electricity)(Charge) Amendment Act - No. 150, 2000, No. 79, 2009)

The legislation establishes the framework for the RET including renewable energy targets, which must be achieved over the period 2001 to 2030, liability requirements, and outlines eligibility requirements for renewable energy sources and power stations.

Amendments to the leglislation from the review of MRET Operation

Amendments to the legislation for expansion of the Renewable Energy Target

The expanded Renewable Energy Target (RET) scheme was proposed in 2009 to encourage additional generation of electricity from renewable energy sources to meet the Government’s commitment to achieving a 20% share of renewables in Australia’s electricity supply in 2020.

Two amendment bills were passed on 20 August 2009 and received Royal Assent on 8 September 2009. The legislation commenced on the 9 September 2009.

Amendments to the Act

Amendments to the Renewable Energy (Electricity) Act 2000 included:

• Increase in and extension of the renewable energy target.
  • The target increases from 9,500 GWh to 45,000 GWh by 2020.
  • The target is extended from 2020 to 2030.
• Solar Credits (REC Multiplier) – eligible small generation units (small-scale solar PV, wind and hydro electricity systems) can receive Solar Credits.
  • Solar credits is a mechanism under the expanded RET scheme which multiplies the number of RECs able to be created for the system.
  • Solar Credits applies to eligible systems installed on or after 9 June 2009.
• Partial exemption from liability under the scheme in respect of emissions intensive trade exposed activities. Transition of existing and proposed state renewable energy target schemes into the RET.
• Existing waste coal mine gas power projects that meet RET eligibility criteria will be able to create RECs up to an annual cap, for a limited period, as a transitional measure to underpin the continued viability of these projects. Annual targets have been increased to ensure no renewable energy is displaced.
• Folding state based certificate schemes into the national RET.
• COAG to examine some of the eligibility provisions of the RET for new small-scale technologies as well as heat pumps and rules for off-grid resource projects to ensure that the eligibility rules remain relevant over time to reflect new technologies and recent developments in renewable technology and resource project development structures.
• A review of the operation of the RET as soon as practicable after 31 December 2013. This includes:
  • a review of the Act, Charge Act and Regulations by a person, that in the Minister’s opinion, possesses appropriate qualification to undertake the review;
  • providing a report of the review to the Minister before 30 June 2014; and
  • the Minister must then table the report in Parliament within 15 sittings days of receiving the report.

Amendments to the Charge Act

Amendments to the Renewable Energy (Electricity) Charge Act 2000 included:

• An increase of the shortfall charge from $40 per MWh to $65 per MWh.
  • The shortfall charge encourages compliance with the RET as liable entities who do not meet their obligations to purchase renewable energy certificates will need to pay this shortfall charge.

Amendments to the regulations

In addition to the legislation changes, consequential amendments are required to the Renewable Energy (Electricity) Regulations 2001 (the Regulations).

The first amendment incorporates changes that allow eligible small generation units (small photovoltaic, wind and electric hydro) to claim additional RECs under a multiplier rule. This amendment is generally referred to as the Solar Credits scheme. The Amendment Regulations were registered on 9 September 2009.

The second amendment incorporates changes that expand the eligible requirements for solar water heaters with a volumetric storage capacity over 700 litres. As part of these requirements eligible installations must be accompanied by a statutory declaration otherwise the installation will not be eligible for RECs. The Amendment Regulations were registered on 9 September 2009. Further amendments to the Regulations are expected and detail will be provided on the ORER website.

For administrative information on these changes contact the ORER on (02) 6159 7700 or via email at orer@orer.gov.au

For policy information on these changes contact the Renewable Electricity Markets, Strategies and Coordination Division of the Department of Climate Change  

Regulations

The Principal Renewable Energy (Electricity) Regulations 2001 (the regulations) were made on 6 February 2001. However, the consolidated Renewable Energy (Electricity) Regulations 2001  are now in force.

The legislation is supported by the regulations. The regulations contain more detailed rules on a number of issues, including additional eligibility criteria for renewable energy sources, accreditation of power stations, eligibility requirements for solar water heaters and small generator units.

Regulation amendments

The ORER regularly amends the Renewable Energy (Electricity) Regulations 2001 (the Regulations) to:

• set the Renewable Power Percentage, which establishes the rate of liability. The RPP is set to achieve the interim targets as specified in the legislation; and
• conduct other administrative changes as required and appropriate.

To fully understand the regulation amendment process read the Regulatory plan.

The Department of Climate Change updates the Regulations to include:

• policy changes; or
• legislative changes as required due to the Renewable Energy (Electricity) Amendment Act 2006, and the Renewable Energy (Electricity) Amendment Act 2009.

Read summaries of the proposed and completed regulation amendments