Legal development

Further progress in delivery of the Central West Orana REZ

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    What you need to know

    The NSW Government has released a suite of documents in its latest step to deliver the Central-West Orana (CWO) Renewable Energy Zone (REZ) Access Scheme, including:

    • the CWO REZ Draft Access Scheme Declaration (Draft Declaration);
    • the CWO REZ Access Rights and Scheme Design: Position Paper (Position Paper);
    • the final Guidelines for Access Scheme Declarations (Guidelines); and 
    • the Final REZ Access Standards (Access Standards). 

    CWO REZ Draft Declaration and Position Paper

    The Draft Declaration is a draft order made under the Electricity Infrastructure Investment Act 2020 (NSW) (the EII Act) which will be the statutory instrument governing access rights for generation and storage projects to connect into the CWO REZ network.  

    The Draft Declaration sets out:

    • eligibility requirements for projects to connect to new network infrastructure within the CWO REZ, including, in relation to the initial allocation:
      • for generation projects, a maximum capacity of 30MW or above (whether alone or in aggregate with other projects which are connected at the same connection point) or generation infrastructure projects awarded a firming infrastructure LTESA;
      • for co-located hybrid infrastructure projects, where the sum of generation and storage components has a maximum capacity of 30MW or above (whether alone or in aggregate with other projects which are connected at the same connection point) or co-located hybrid infrastructure project awarded a firming infrastructure LTESA; and
      • for storage projects, storage infrastructure projects, including standalone short duration storage systems; 
    • the initial capacity of access rights (in MW) that may be granted to projects (including generation, storage and co-located hybrid projects) including:
      • the aggregate maximum capacity cap – the initial capacity cap of the access rights network is 5.84GW, although it may be increased by the Infrastructure Planner following a headroom assessment;
      • capacity profiles – initially, access rights will be granted to projects on the basis of a flat maximum capacity profile across a single 24-hour day capacity period; and
      • the target transmission curtailment level – the target transmission curtailment level has been updated from 0.3% to 4.37% to account for the increased aggregate maximum capacity cap; 
    • procedures for granting access rights, including:
      • the initial allocation threshold – the Infrastructure Planner may determine that the initial allocation has been completed before the full award of 5.84GW if the aggregate maximum capacity granted in the initial allocation exceeds 90% of the initial aggregate maximum capacity cap or if further access rights being granted will result in the target transmission curtailment level being exceeded;
    • the process for increasing the amount of capacity granted to projects, including:
      • market-led augmentations – market-led augmentations may increase the transfer capacity of the access rights network or the transfer capacity of an individual network element; and
      • project modifications – the Infrastructure Planner may approve and grant an increase in the maximum capacity of a project if it will not cause a breach or the aggregate maximum capacity cap or cause the forecast curtailment to exceed the target transmission curtailment level; and 
    • the duration of access rights – the initial term of the CWO REZ Access Scheme is the period from the access scheme declaration to 20 years from the date of the electrification of the first network element of the access rights network. 

    The Position Paper is intended as a guide to the Draft Declaration and aims to explain the policy positions and purpose of the Draft Declaration. The Position Paper should be read in conjunction with the Draft Declaration.

    A copy of the Draft Declaration can be found here.  A copy of the Position Paper can be found here.

    Guidelines for Access Scheme Declarations

    The EII Act requires the Minister to publish guidelines about the exercise of his or her functions in relation to the declaration of access schemes. Draft Guidelines were published on 11 May 2022, with stakeholder consultation closing on 8 June 2022. 

    The main addition to the draft Guidelines is to clarify that an access scheme declaration may specify all or a subset of the network infrastructure that forms part of a REZ. The final Guidelines state that where the Minister proposes to specify existing infrastructure as forming part of an access scheme network, the Minister may include terms in the access scheme declaration to prevent impacts on parties such as generation or storage proponents that are already connected to the relevant network, or that are substantially progressed in their development or in the connection process.

    The main departure from the draft Guidelines is the removal of an access prohibition mechanism. The draft Guidelines included that an access scheme may prohibit access of network operators and generation or storage infrastructure to specified network infrastructure in a REZ. The final Guidelines no longer include reference to access prohibition and instead state that the unique characteristics of each REZ will inform the need for any access control mechanism and the method of access control. 

    A copy of the Guidelines can be found here.

    Final REZ Access Standards

    EnergyCo, as Infrastructure Planner under the EII Act for CWO REZ, has now published the final REZ Access Standards, after releasing a draft of its proposed access standards in April 2022 and consulting with Transgrid, the Australian Energy Market Operator (AEMO) and the developer community. 

    The REZ Access Standards will apply for the initial grant of access rights for generation and storage projects to connect to the CWO REZ network infrastructure. 

    A copy of the Access Standards can be found here.

    What you need to do

    • Stakeholders can provide feedback on the CWO REZ Draft Access Scheme Declaration via email to contact@energyco.nsw.gov.au with 'Your Name – Draft CWO REZ Access Scheme Declaration' in the subject line.  Submissions on the Draft Declaration are due by 12 August 2022. 
    • Network operators and operators of generation and storage projects with existing or proposed projects located within any of the five NSW REZs should review the final guidelines on access scheme declarations and consider how an access scheme declaration may impact the development or operation of their projects.
    • Operators of projects located within the CWO REZ should carefully review the final REZ Access Standards released by EnergyCo and consider whether their project meets or will meet the various performance standards required for access rights in the CWO REZ.