RENEWABLE ENERGY (ELECTRICITY) AMENDMENT (FEED-IN-TARIFF) BILL 2008

2008

The Parliament of the

Commonwealth of Australia

THE SENATE

Presented and read a first time

Renewable Energy (Electricity) Amendment (Feed-in-Tariff) Bill 2008

No. , 2008

(Senator Milne)

A Bill for an Act to amend the Renewable Energy (Electricity) Act 2000 to support the greater commercialisation of renewable energy technologies, and for related purposes

Contents

A Bill for an Act to amend the Renewable Energy (Electricity) Act 2000 to support the greater commercialisation of renewable energy technologies, and for related purposes

The Parliament of Australia enacts:

1 Short title

This Act may be cited as the Renewable Energy (Electricity) Amendment (Feed-in-Tariff) Act 2008.

2 Commencement

This Act commences on the day on which it receives the Royal Assent.

3 Schedule(s)

Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.

4 Object

The object of this Act is to support the commercialisation of a broad range of prospective renewable energy technologies by:

(a) providing specifically tailored support for a range of renewable energy technologies that are currently not adequately assisted by the mandatory renewable energy target;

(b) requiring electricity retailers to permit owners of qualifying generators to supply the electricity grid with electricity generated from selected renewable energy sources;

(c) providing a payment to owners of qualifying generators for the renewable electricity which they produce from renewable energy sources installed after the commencement of this Act;

(d) establishing an effective monitoring regime to monitor the extent of production of renewable electricity by owners of qualifying generators.

5 Review of operation of Act

(1) The Minister must cause to be prepared an independent report on the operation of the amendments made by this Act for the period beginning on the date of its commencement and ending on the next 30 June after date, and for each subsequent 12 month period ending on 30 June in a later year.

(2) If the day on which this Act commences is on or after 1 January in a year, the report prepared under subsection (1) in relation to the period from that day to 30 June in that year must be included in and presented with the report prepared under subsection (1) for the year beginning on 1 July next following the commencement of this Act.

(3) The Minister must cause a copy of a report prepared under subsection (1) to be laid before each House of the Parliament within 5 sitting days of that House after the day on which he or she receives the report.

(4) A report prepared under subsection (1) must include:

(a) details of total renewable energy produced from each source listed in section 17 of the Renewable Energy (Electricity) Act 2000; and

(b) total payments made under the feed-in-tariff rate scheme established by section 34C of the Renewable Energy (Electricity) Act 2000; and

Schedule 1--Amendment of the Renewable Energy (Electricity) Act 2000

1 Section 5

Insert:

direct customer means a person or company who:

(a) is directly connected to an electricity distribution network other than by means of the distribution system of the electricity retailer; and

(b) satisfies other criteria (if any) prescribed by the regulations for the purposes of this definition.

electricity retailer is a company or other entity that provides electricity to customers.

excluded network means an electricity distribution network that supplies electricity to less than 10,000 retail customers.

feed-in-tariff rate scheme means the scheme established by section 34C.

kWh means kilowatt hour.

qualifying generator means a renewable energy electricity generator that:

(a) is installed after the commencement of the Renewable Energy (Electricity) Amendment (Feed-in-Tariff) Act 2008; and

(b) complies with the relevant Australian Standard; and

(c) is connected to an electricity distribution network in a manner that allows electricity generated by the renewable energy electricity generator to be fed into the electricity distribution network, other than where the electricity distribution network is an excluded network; and

(d) generates electricity from a source listed in section 17 as an eligible renewable energy source; and

(e) forgoes participation in the mandatory renewable energy target scheme.

retail customer means a customer who:

(a) ordinarily acquires electricity primarily for domestic or business use; and

(b) is not a direct customer; and

2 After Part 3

Insert:

Part 3A--Acquisition of electricity from owners of qualifying generators

34A Feeding-in of electricity to grid by owners of qualifying generators

(1) Electricity retailers must:

(a) permit an owner of a qualifying generator to feed into the grid electricity generated by the qualifying generator (subject to complying with any relevant technical, safety or other requirements imposed by or under this or any other Act or relevant instrument); and

(b) comply with such reporting requirements as may be prescribed.

(2) An owner of a qualifying generator who feeds into the grid in accordance with subsection (1) must install a meter, of a type prescribed by the regulations for the purposes of this subsection, to measure the total amount of renewable electricity energy generated by the qualifying generator.

34B Registration of qualifying generators

An owner of a qualifying generator who feeds into the grid electricity generated by the qualifying generator is eligible to receive payments of the feed-in-tariff rate in accordance with section 34G, subject to the owner of the qualifying generator:

(a) registering the qualifying generator with the Regulator, for inclusion in the Feed-in-Tariff Register established under section 34F; and

(b) complying with any relevant technical, safety or other requirements imposed by or under this or any other Act or relevant instrument.

34C Feed-in-tariff rate scheme

(1) The feed-in-tariff rate scheme is established by this section.

(2) The feed-in-tariff rate scheme is the payment to the owner of a qualifying generator that is registered with the Regulator of an amount, calculated by reference to:

(a) the relevant feed-in-tariff rate set by the Minister under section 34D; and

(b) all the electricity produced by that qualifying generator, not just the electricity which is exported to the electricity grid.

34D Feed-in-tariff rates

(1) The Minister must, within 28 days of the commencement of the Renewable Energy (Electricity) Amendment (Feed-in-Tariff) Act 2008, set the feed-in-tariff rates for qualifying generators that are to be paid under the feed-in-tariff rate scheme in respect of a qualifying generator that is registered for the first time during the financial year in which that Act commences.

(2) The Minister must, by the end of each financial year, set the feed-in-tariff rates for qualifying generators that are to be paid under the feed-in-tariff rate scheme in respect of a qualifying generator that is registered for the first time during the following financial year.

(3) The Minister may set a target level of installed capacity to be achieved. If the Minister sets a target level of installed capacity to be achieved, the Minister cannot change it until the fifth anniversary of the date on which the target level was initially set.

(4) In setting the feed-in-tariff rates in accordance with subsection (1) or (2), the Minister may take into account:

(a) the type of qualifying generator; and

(b) the location of the qualifying generator; and

(5) If the Minister has set the feed-in-tariff rates that are to apply for a financial year, the Minister must not vary those rates during that financial year.

(6) In setting the feed-in-tariff rates in accordance with subsection (2) that are to apply for the following financial year, the Minister may increase, vis-Ã -vis the current financial year feed-in-tariff rates, a feed-in-tariff rate that is to apply during that following financial year.

(7) Subject to section 34B, the relevant feed-in-tariff rate is payable to an owner of a qualifying generator for each kWh of electricity generated by the qualifying generator during a financial year.

(8) In setting the feed-in-tariff rates in accordance with subsection (1) or (2), the Minister's objective is to support the economic viability of a set quantity of electricity generation from a range of prospective renewable energy technologies.

(9) The Minister must not reduce a feed-in-tariff rate set under subsection (1) or (2) during the period of 5 years starting on the date that that rate is initially set by the Minister.

(10) If the Minister reduces a feed-in-tariff rate in accordance with subsection (9), the reduction must not be more than 10 per cent of the rate that applied before the reduction.

(11) The restrictions in subsections (9) and (10) on reductions to the feed-in-tariff rate do not apply if the level of installed capacity, which may be set by the Minister under subsection (3), is achieved.

(12) A feed-in-tariff rate set under subsection (1) or (2) and payable to the owner of a qualifying generator at the date of the registration of the qualifying generator is fixed and guaranteed for a period of 20 years from the date of the registration.

(13) The feed-in-tariff rates set for qualifying generators must be reviewed annually by the Minister in accordance with the following factors:

(a) the prospect for the technology to reliably produce competitively priced electricity by the end of the calendar year 2020; and

(b) the environmental cost or impact of the technology.

(14) The Minister must provide a statement explaining how the feed-in-tariff rates are calculated and must table that statement in both Houses of Parliament within 15 sitting days after the end of each financial year.

(15) The feed-in-tariff rates set under subsection (1) or (2) and the statement made under subsection (14) by the Minister are not legislative instruments and section 42 (disallowance) of the Legislative Instruments Act 2003 does not apply to them.

34E Feed-in-tariff levy rate

(1) The Minister must, by the end of each financial year, set a feed-in-tariff levy rate per MWh of electric energy acquisition from the electricity grid, to fund the feed-in-tariff rate scheme for the following financial year. The feed-in-tariff levy is imposed by the Renewable Energy (Electricity) Feed-in-Tariff Levy Act 2008.

(2) The Minister must ensure that the feed-in-tariff levy rate set in accordance with subsection (1) is sufficient to cover the estimated cost of payments under the feed-in-tariff rate scheme.

(3) The feed-in-tariff levy is payable by all electricity retailers and direct customers of electric energy from the grid, calculated by reference to their annual energy acquisition statements lodged under section 44.

Note: The annual energy acquisition statement is used to calculate the renewable energy shortfall charge of an electricity retailer or a direct customer (a liable entity). The same statement is to be used to calculate the amount of the feed-in-tariff levy.

(4) The Minister must provide a statement explaining how the feed-in-tariff levy rate is calculated and must table that statement in both Houses of Parliament within 15 sitting days after the end of each financial year.

(5) The feed-in-tariff levy rates set under subsection (1) and the statement made under subsection (4) by the Minister are not legislative instruments and section 42 (disallowance) of the Legislative Instruments Act 2003 does not apply to them.

34F Establishment of a Feed-in-Tariff Register

(1) The Regulator must establish a register to be known as the Feed-in-Tariff Register (the Register).

(2) The Regulator must record in the Register:

(a) details of all registered qualifying generators, including the name and address of the owner of the qualifying generator, the date of registration of the qualifying generator and the type of qualifying generator (that is, the eligible renewable energy source used by the qualifying generator); and

(b) the total amount of electricity produced by each registered qualifying generator; and

(c) the feed-in-tariff rate to be paid to the owner of a registered qualifying generator and the period for which the feed-in-tariff rate will be paid.

(3) The Regulator must provide details of the amount of total payments made under the feed-in-tariff scheme for inclusion in the report prepared in accordance with subsection 5(1) of the Renewable Energy (Electricity) Amendment (Feed-in-Tariff) Act 2008.

34G Feed-in-tariff rate payments

(1) The owner of a qualifying generator must lodge with the Regulator within 30 days of each anniversary of the registration of the qualifying generator an annual return in the prescribed form indicating the metered energy produced by the qualifying generator.

(2) The Regulator must pay the feed-in-tariff rate to the owner of a qualifying generator within 30 days of receiving from the owner an annual return in accordance with subsection (1).

(3) Payments in accordance with subsection (2) are to be made from money appropriated by the Parliament for that purpose.

Renewable Energy (Electricity) Amendment (Feed-in-Tariff) Bill 2008 No. , 2008

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