Post-2025 market design

Publication date

Friday 29 October 2021

The former Council of Australian Governments (COAG) Energy Council tasked the Energy Security Board (ESB) with developing advice on a long-term, fit-for-purpose market framework to support reliability that could apply from the mid-2020s.

In July 2021, the ESB provided recommendations to Energy Ministers, as part of the Energy National Cabinet Reform Committee (ENCRC), on its redesign of the National Electricity Market (NEM) to enable the provision of the full range of services to customers necessary to deliver a secure, reliable and lower emissions electricity system at least cost.

The ESB’s advice includes recommendations across 4 reform pathways that seek to:

strengthen signals for investment in the right mix of capacity to keep the system reliable, affordable and secure
deliver essential system services to maintain grid stability
improve transmission and access arrangements to ensure timely transmission investment, incentivise better use of the network to lower costs for consumers and reduce investment uncertainty
better enable participation of flexible demand side resources and the integration of distributed energy resources (DER).

In October 2021, National Cabinet endorsed the final package of reforms for the Post-2025 NEM, as agreed by the ENCRC in September 2021. The final package responds to recommendations provided by the ESB in its final advice (see links to reports below).

See a summary of the final reform package and corresponding ESB recommendations, with further details on recommendations across the 4 reform pathways identified by the ESB below:

National Cabinet also agreed on the Interim Framework for Renewable Energy Zones and adopted the ESB’s recommended principles. This follows the ENCRC’s agreement to the Stage I REZ Planning Rules, which came into effect on 13 May 2021. The Interim Framework will support development of Renewable Energy Zones in a way that is more consistent and predictable.

Please visit the ESB's microsite for more information on the ESB process.