The changes to the NNO cost recovery arrangements will improve coordination between NNO proponents and TNSPs, recognising the role of non-network solutions in supporting the grid. Drawing from the experience of progressing NNO projects to date, we propose the AEMC further considers details around the payment methodology, the NNO selection process, and the transitional arrangements.
Refining the methodology approval settings to consider the materiality threshold and timing will better reflect the lessons learnt from implementing NNO projects. We also consider that the early termination payment requires a greater level of regulatory certainty.
As the energy transition progresses, most NNO projects will rely on clean energy projects. Their contribution to decarbonisation is a key differentiation to other types of network support solutions. This competitive advantage could be recognised by the rule change.
The AEMC could also ensure that existing projects are not delayed by unforeseen regulatory changes when implementing the rule change.
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