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 The NEM is a grand redesign of our electricity supply system, but has it forgotten social and environmental issues? Traditional coal fired power appears to have the upper hand in the Market's operations while demand management and renewable energy struggle for a place.
Background
The National Electricity Market (NEM) is intended to improve the efficiency of electricity supply and sale and has encouraged inter-connections between state based generators, so that over capacity can be used; and not perpetuated to avoid costly investment in new power generation and delivery infrastructure. Prices for power vary according to demand (eg, peak power is very expensive). The NEM is comprised of three agencies - NEMCO which operates the day to day activity of buying and selling electricity; AEMC which makes and changes the rules and consults the industry and the public; and the AER which ensures compliance with the rules - under the charge of the Ministerial Council for Energy.
Operating the Market (NEMCO)
The Rules for the Market (AEMC)
Enforcing the Rules (AER)
The NEM is really Australia's carbon trading market as most of the power is from burning fossil fuels. In addition to the NEM there are a range of state and federal policies and laws (see Green or Black?)
The Debate
You can buy and sell power from the NEM but does it do it in a most efficient and environmentally responsible way? The supporters of the NEM say it has created a more rational energy planning and supply system, while critics point to its lack of focus on energy conservation and renewables. Energy conservation in particular is cheaper and more efficient than building new power stations. Both business and residential consumers will face steeply rising power prices as up to $30 billion is proposed to be spent on the power system. The Parer Report canvassed a number of challenges facing the NEM.
Environment and Social Issues for the NEM (TEC)
Parer Report
TEC Position
National and state environment and consumer groups have proposed a package of reforms, so that the NEM is more responsive to climate change concerns; takes better account of low income consumers; allows improved community involvement and supports energy conservation.
National Electricity Law Amendment Package
TEC is making ongoing submissions and advocacy for an improved NEM.
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