Public Policy Papers

Public Policy Paper #1/2017: How to reform the electricity market before we reach the top of a cliff

Author: Stephen Wilson, Cape Otway Associates

Key Points

  • The Australian National Electricity Market (NEM), burdened by the effect of the Renewable Energy Target (RET) schemes, is no longer capable of delivering a reliable, affordable and sustainable electricity supply. The NEM, or the RET schemes, or both, will need to be changed to avoid serious failure of the power system in the future.
  • This paper sets out in plain English a statement of the problem, a diagnosis of the underlying causes at the root of the problem, remedies that have been proposed to solve it, and a vision for reform that would require minimal design changes to create the next generation electricity market.
  • Six symptoms of the problem evident in the NEM have been identified, which adversely affect power companies, as well as business and household consumers. The root causes are found in conflicts between the design principles on which the NEM is based and those of the RET schemes.
  • Seven possible responses have been identified, which are considered remedies rather than options, as some of them are potentially complementary. Some remedies would involve retreating from the competitive electricity market reforms of the 1990s, while others would take the reforms to a more mature stage.
  • The paper makes recommendations that could redress the root causes of the problem, with a minimum of disruption to consumers, the electricity system and the market, and reduce rather than escalate government intervention.

pdf Click here to download the full paper

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The Institute’s submission to the COAG Energy Council, August 2016.

Policy Papers

Public Policy Papers: A compendium of Key Points (to May 2018) 

Since May 2013 the Institute has published 20 Public Policy Papers.

pdfClick here to view the compendium of key points. 


Public Policy Papers : A Compendium of Key Points (Aug 2016)

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Since May 2013 the Institute has published twelve Public Policy Papers.

pdfClick here to view the compendium of key points.

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