PIAC lodged a submission to the Energy Security Board’s (ESB) draft metrics for its Strategic Energy Plan. The purpose of the Strategic Energy Plan is to ensure a clear, strategic focus for the COAG Energy Council’s work and to provide clarity of direction to market bodies and market participants. Using the proposed metrics, the ESB will report on and track progress against meeting the Strategic Energy Plan.
PIAC supported the ESBs intended role and nature of metrics in the plan, and recommended changes to the ESB’s draft metrics on matters including:
- Risk allocation – Risk should be allocated so that those exposed risks to have the ability and incentive to manage them. This is particularly important in the regulated network segments of the energy supply chain.
- The trade-off between reliability and affordability – including in generation and ensuring there are accurate measures of how much consumers value reliability (i.e.: the value of customer reliability or VCR)
- The use of demand response – In PIAC’s view, any part of the energy system that does not fully employ demand response where it is cost effective to do so, cannot be considered to be operating efficiently.