The Australian Energy Market Commission (AEMC) has made a final rule determination to help make the electricity grid more resilient to extreme weather events.
The final rule is in response to a request from Victorian Energy and Resources Minister, Lily D’Ambrosio, after separate severe weather events left hundreds of thousands of people without power, in some cases for several weeks.
Storms, flooding, and bushfires are becoming more frequent and intense, adding further strain to the electricity distribution network and leaving millions of homes and businesses exposed to power outages.
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With climate change expected to further exacerbate these events, distribution network resilience will now be explicitly recognised in the national electricity rules, establishing a formal framework that includes:
- new resilience expenditure factors that Distribution Network Service Providers (DNSPs) and the Australian Energy Regulator (AER) must consider in developing and assessing expenditure proposals
- a requirement for the AER to develop, publish, and maintain formal Network Resilience Guidelines
- new annual planning and reporting requirements to improve the transparency and accountability of DNSP performance, and outcomes for consumers, in severe weather events.
The increased regulatory clarity helps DNSPs effectively plan for extreme weather and invest in measures that reduce the risk of power outages while helping customers in need.
These could include adaptation investments to strengthen poles and wires in high-risk communities, relocate infrastructure in flood prone areas, or increase the number of mobile generators and substations that can keep the lights on when the power supply is disrupted.
Additionally, DNSPs can propose resilience spending on programs to manage bushfire and flood risks.
AEMC chair Anna Collyer said the final rule was developed with the long-term interests of consumers in mind.
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“The new framework supports more equitable outcomes, while improving the transparency and accountability of resilience spending that benefit all consumers,” she said.
From 2 October 2025, Victorian DNSPs can include resilience expenditure factors in their revised regulatory proposals, which the AER must take into account in its final determinations for the 2026-31 regulatory control period.
The final rule is part of a larger program of work designed to reduce the impacts of climate change on the energy grid.
