The Australian Government remains focused on ensuring households and businesses have access to reliable power. The Australian Energy Market Operator (AEMO) has forecast that, without additional investment in dispatchable generation, there is a risk of supply shortfalls. To help address this, the former COAG Energy Council agreed to introduce the Retailer Reliability Obligation (RRO).
The RRO came into effect on 1 July 2019. It will ensure energy retailers (and some large energy users) are accountable for reliability in the National Electricity Market (NEM). If the RRO is triggered, it will require retailers to demonstrate they are sufficiently contracted to meet their share of expected system peak demand.
This is a long-term solution that will provide a clear signal to businesses and market participants to invest in generation and demand response to support reliability in the NEM.
The RRO was designed by the independent Energy Security Board (ESB) with extensive input from a range of industry stakeholders.
The RRO is just one of a number of measures that will help address reliability challenges. The government is committed to continuing work with the states and territories through the Energy National Cabinet Reform Committee to deliver reliable, secure and more affordable energy.