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Posted: 2018-06-15 14:04:10

Updated June 16, 2018 00:23:43

Big business could be forced to help keep the lights on for the whole country under a draft of the Government's National Energy Guarantee (NEG) obtained by the ABC.

A "reliability requirement" would "incentivise" large energy users to help put more dispatchable power back into the grid if a nationwide shortfall looks likely.

A "reliability obligation" could also be triggered, where big business could be "expected to demonstrate" how they would source dispatchable power in times of peak demand.

If there is still a shortfall, the government would also have the ability to "procure the required resources to close the remaining gap".

Big business is worried the system would force them to take on risk and cost for dealing with power shortfalls.

"We are keeping an open mind, but we do have some concerns that need to be sorted out," Andrew Richards, chief of the Energy Users Association of Australia, said.

The EUAA represents large electricity consumers such as aluminium smelters, Woolworths and Wesfarmers.

Under the system, big businesses which did not want to take part in the reliability requirement could negotiate with their energy supplier to manage their obligations for them.

But that could come at a cost.

Mr Richards said many large businesses, such as steel makers, already worked with the energy market to manage the risk of power shortfalls.

"If it's in their best interest to participate they should be able to, but if you don't want to, you shouldn't be penalised for opting out," he told AM.

"The last thing anyone wants is an outcome which penalises consumers."

The Minerals Council is also concerned about "the cost to large customers of the proposed reliability obligation, including on mining companies in remote areas with limited alternatives".

Mr Richards said business users were concerned the design of the system had been rushed as the Government looked toward an election next year.

"The timeframes that have been set are pretty extreme and to be frank that doesn't help with building confidence," he said.

A final design of the system is due to be finalised in August.

"We would hope that if there are still outstanding issues [in August] that the Federal Government will direct the Energy Security Board to take more time."

Federal Energy Minister Josh Frydenberg refused a request for an interview.

Topics: business-economics-and-finance, industry, electricity-energy-and-utilities, government-and-politics, australia

First posted June 16, 2018 00:04:10

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