Australia’s National Energy Market (NEM – for more information see ShopAround's summary of NEMMCO) is regulated by the Australian Energy Market Commission (AEMC) and the Australian Energy Regulator (AER). These bodies are statutory bodies created in mid-2005 by the Ministerial Council on Energy which is the Federal Government body responsible for policy oversight of the Australian energy market.
The AER and AEMC have taken over many of the electricity and gas regulatory arrangements that were previously the responsibility of state government authorities.
The AEMC promotes the strategic longer-term design and development of energy markets. It is responsible for rule making, market development and policy advice concerning the National Electricity Market (NEM), prescribed in the National Electricity Law (NEL).
The objective of this law;
“is to promote efficient investment in and efficient use of electricity services for the long term interests of consumers of electricity with respect to (a) price, quality, reliability and security of supply of electricity; and (b) the reliability, safety and security of the national electricity system.”
NEM’s job is to ensure your satisfaction as a consumer of electricity, creating a fortified energy market where gas prices and electricity prices are competitive and as cheap as possible, making sure your lights always stay on. AEMC’s role does not currently relate to regulating the electricity companies who you deal with; however the AEMC is responsible for reviewing the effectiveness of competition in the gas and electricity retail markets.
The Australian Energy Regulator (AER) is a constituent part of the Australian Competition and Consumer Commission (ACCC). The AER has responsibility for the enforcement of and monitoring compliance with the National Energy Law, and is responsible for the economic regulation of the electricity and gas: wholesale market, transmission and distribution networks in the NEM (in all jurisdictions except Western Australia and Northern Territory). The AER issues infringement notices for certain breaches of the National Electricity Law and Rules, and is the body responsible for bringing court proceedings in respect of breaches.