The National Irrigators’ Council today welcomed the release of the Energy Security Board’s final advice to Energy Ministers for a post 2025 market design for the National Energy Market.

Chief Executive Isaac Jeffrey said: “As the energy market undergoes transition, agriculture food and fibre producers need to be assured that, as part of the mix of transmission sources and technologies, rural industries will not be unfairly disadvantaged with high energy costs that make their businesses unsustainable.

“It has long been the aspiration of National Irrigators’ Council of a price objective of a medium to long term price capped at 8 cents per kilowatt-hour for the electrons (R) and a similar ceiling of 8 cents per kilowatt-hour for the network (N).

“We highlight the particular needs of the agriculture sector and regional communities in all elements of market and grid design, including structure and costs to facilitate rural consumers and the agricultural sector taking up new technology and being connected to the grid. This includes technologies that can be rolled out on a scale which will make their use viable on farms and in agricultural processing.

“NIC welcomes the ESB recognition of the issue to be addressed – and that is essential system services and ahead scheduling – to ensure that the essential services are available to maintain system security. These include frequency, control, operating reserves, inertia and system strength.

“Under current arrangements, frequency control ancillary services (FCAS) are called upon to stabilise the grid, though there is something very wrong with National Energy Market (NEM) rules where the cost of providing FCAS is passed on to consumers, and for large agriculture industry customers, these costs are significant.

“It will be important that agriculture industries are included in the cohort of large commercial and industrial energy consumers (C&I), recognising the sector’s contribution to Australia’s food and fibre production, where the sector is rightly seeking to be competitive and to provide jobs and export opportunities.

“As part of the ESB’s package of transmission and access reform measures, if accepted by Government, it would be reasonable to expect that policy and/or regulatory proposals put forward by infrastructure owners, provide a 2-3 page ‘regional and rural implications statement’, detailing the likely impact of the proposal or reform.

“The agriculture sector needs policy and regulatory frameworks that do not impede the take up of new technologies, for example, making grid connection and microgrids practical and affordable. We caution against the imposition of exaggerated costs associated with unwarranted and unnecessary regulation in market design development and implementation to avoid ‘gold plating’.

“It is critical that the management of costs for consumers remain front and centre with the right market design and forward planning for implementation.”

Ends. Media Contact: Isaac Jeffrey 0407 083 890