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Congestion Relief Market a better alternative to Congestion Management Mechanism

The Clean Energy Council is urging the Energy Security Board (ESB) to work collaboratively with industry to speed up the safe and reliable decarbonisation of Australia’s power system.

In responding to the ESB’s Transmission access reform - Project initiation paper, the Clean Energy Council says that it is imperative to develop regulatory reforms that support investors to bring new renewable generation and storage projects to market so that they can deliver low-cost, zero-carbon energy to consumers.

The ESB’s proposed whole-of-system Congestion Management Mechanism (CMM) will increase uncertainty and weaken investment signals for new wind, solar and storage in many parts of the power system – especially outside renewable energy zones. Given that we need over 170,000 MW of new generation investment to keep the lights on, this can only result in worse outcomes for energy consumers.

“Good regulatory reform supports investment in the new generation, storage and network infrastructure required to meet Australia’s growing need for renewable energy,” said Clean Energy Council Director of Energy Transformation, Christiaan Zuur. “We are supportive of the work of the ESB and the market bodies, where it delivers on that outcome. This includes finding ways to help reduce congestion that is preventing generators from getting their power to market.”

“With that in mind, it’s disappointing that the ESB continues to consider the so-called ‘congestion management mechanism’. This model is fundamentally flawed and will make it harder for investors to build new renewable generation and storage because it will weaken the flexibility and openness of the National Electricity Market.”

The Clean Energy Council says the proposed CMM will also slow down the decarbonisation of the Australian electricity system, which is in turn central to the decarbonisation of the Australian economy – something both of Australia’s political parties have committed to in the lead-up to this year’s Federal Election.

Instead, the ESB should consider Clean Energy Council member Edify Energy’s ‘Congestion Relief Market’ as a transparent, market-based alternative. The Congestion Relief Market will deliver better investment and operational outcomes to new and existing generation and storage in the system at a lower cost to consumers.

The Clean Energy Council’s full submission on the ESB’s Transmission access reform - Project initiation paper can be found here.


For more information or to arrange an interview, contact:

Jane Aubrey
Clean Energy Council Media Manager
[email protected]
+61 409 470 683