Roadmap sets pathway for reform implementation in the NEM

2 min

The Australian Energy Market Operator (AEMO), together with industry, is working to deliver a number of the Energy Security Board’s (ESB) Post 2025 market reforms  for the energy market.

The reforms provide changes to key elements of energy market design to facilitate a transition towards a modern energy system capable of meeting the evolving needs of consumers, as well as the continued provision of services necessary to deliver a safe, reliable and lower emissions electricity system at least-cost for all Australians.

As part of this commitment, AEMO has led the development of a NEM Reform Implementation Roadmap, together with the Reform Delivery Committee (RDC), to navigate the system and process changes resulting from Post-2025 and other reforms, de-risking their delivery and informing the timing of their implementation.

This release includes an integration of the Regulatory Implementation Roadmap – Version 7 and NEM2025 Implementation Roadmap – Version 2 to provide a holistic view of the regulatory reforms and IT uplift initiatives over the coming years.

AEMO’s Executive General Manager – Reform Delivery, Violette Mouchaileh, said the roadmap sets out a baseline plan for the implementation of initiatives and identifies where strategic investments, such as IT systems and business processes, can be made to deliver efficient outcomes for AEMO, market participants and consumers. The first version of the Roadmap was released for consultation in April 2022.

“The invaluable feedback from across the industry and the RDC has helped AEMO develop an integrated timeline for implementing the full suite of ESB initiatives as part of AEMO’s NEM2025 Program,” said Ms Mouchaileh.

In developing the Roadmap, AEMO and RDC members noted the significant challenges and risks associated with delivery of the NEM2025 Program, including managing uncertainty in scope, timing and cost of initiatives, establishing a basis for AEMO strategic and foundational investments in systems, and setting an appropriate funding strategy. 

Recognising these challenges, the Roadmap commits to delivery of mandatory and no regrets initiatives in a timely way. It also sets a pathway and progressive commitment process that will help manage and de-risk delivery of those initiatives with greater uncertainty in policy, design, scope or timing. This process includes:

  • a change management process to manage and advise on impacts of new initiatives added to the reform scope or changes in policy or rules scope/timing of existing proposed initiatives.
  • a stage gate approach which includes a cost/benefit analysis and industry consultation for AEMO strategic/foundation initiatives, and
  • a progressive investment commitment process and draw down of funds that will be informed by Regulatory Determinations and the Stage Gate process.

The NEM2025 Program is expected to launch to industry and stakeholders in September 2022, with integrated solution design work commencing immediately upon the Program initiation as the next phase of the planning process.

“Collaboration across industry is critical to efficiently and effectively implementing the ESB’s post-2025 reforms thereby enabling the energy transition for the benefit of all Australians,” said Ms Mouchaileh.

AEMO has worked closely with the ESB and industry on these planning activities and will continue to do so for the duration of the implementation of the NEM2025 reforms.

Cookies help us improve your website experience.
By using our website, you agree to our use of cookies.