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AEMC paves the way for more off-grid systems

On 30 May 2019, the Australian Electricity Market Commission (AEMC) made a recommendation that would allow more stand-alone power systems for remote customers, potentially delivering huge savings on the network investment needed to service them.

At the moment, remote customers are cross-subsidised by the rest of the electricity system to fund thousands of kilometres of poles and wires. The changes flagged by the AEMC mean a mix of solar, batteries and diesel could be used, delivering savings and making these areas more resilient to damage from natural disasters. Distribution networks will still cross-subsidise their existing customers, but new connections will be competitively sourced.

The Clean Energy Council has advocated for this decision for a number of years and will be urging the law makers to amend the National Electricity Law and relevant jurisdictional laws as quickly as possible.

Western Australia is expected to lead the nation in replacing poles and wires as it has the expertise and can act in advance of the rest of the country because it is outside of the National Electricity Market. Horizon Power has long been a leader in the use of microgrids, while Western Power has already identified thousands of potential opportunities for stand-alone systems to replace poles and wires in Western Australia.

The next stage of the AEMC review will examine the regulatory frameworks for stand-alone power systems provided by third parties such as businesses, property developers, local councils and community organisations.