Queensland Gas Scheme

Queensland Gas Scheme participants

Generators

Participation in the scheme for power generators is optional; however, one of the objectives of the scheme is to provide an incentive for generators to use gas in the generation of electricity. Any power station that does or will generate eligible gas-fired electricity can participate.

Gas-fired generation is electricity generated from eligible fuels such as:

• natural gas
• coal seam gas (including waste coal mine gas)
• liguefied petroleum gas
• waste gases associated with conventional petroleum refining.

Accreditation under the scheme will only be granted to a generator on the basis that it does or will generate electricity:

• from an eligible fuel source
• above a baseline (representing existing gas-fired generation as at May 2000)
• that supports electricity load in Queensland.

In order to apply to become an accredited generator, the approved power station accreditation form (Word, 1MB) must be completed and sent to the regulator, accompanied by the appropriate application fee.

Only accredited generators can create Gas Electricity Certificates (GECs) for eligible gas-fired generation. Accredited generators are also entitled to all the rights of other scheme participants, such as the right to transfer, mortgage and surrender GECs.

The Electricity Act 1994 imposes a number of general conditions on an accredited generator, including payment of an annual fee, suspension, cancellation and surrender. The regulator may state individual or special conditions that apply to the accreditation. If there is a conflict between the special conditions and the conditions imposed by the Act, the latter will prevail to the extent of the inconsistency.

The accreditation takes effect on the day stated in the accreditation or, if it states no day of effect, the day it is issued. An accreditation remains in force until 31 December 2020, however the right to create GECs will only apply to electricity generated up to and on 31 December 2019.

As at 30 June 2010, there were 23 accredited generators in Queensland.

Retailers and liable persons

Queensland electricity retailers and other liable parties are required to participate in the Queensland Gas Scheme. They must apply in the approved scheme participant form (Word, 394KB) to be registered as scheme participants (liable persons). This enables them to hold an account on the GEC Registry and obtain ownership of GECs.

Scheme participants are able to apply for exemptions from the annual GEC liability for the following:

• renewable energy exemption
• state development exemption
• auxiliary load exemption.

A liable person is the entity required to fulfil the liability to source the prescribed percentage (currently 15%) of their electricity sold or used in Queensland from eligible electricity.

The liability attaches to one person for one single 'parcel' of electricity. No two parties can be liable for the same electricity unless they are bound to jointly sell or use the electricity. The liability only applies to particular persons who have a relationship with a major grid or to an accredited generator for a power station connected to a small grid.

While parties should consult the Electricity Act 1994 and the Electricity Regulation 2006 to consider the liability clauses, the general principle for determining liability in relation to electricity loads supplied by a major grid is that the liable person is:

• the relevant retailer for the load - if there is more than one retailer, the last retailer to sell the electricity in the supply chain
• if there is no relevant retailer for the load, the relevant special approval holder for the load; or if there is more than one special approval holder, the first special approval holder to sell the electricity in the supply chain
• if there is no relevant retailer or relevant special approval holder for the load, any other person who acts as a retailer in relation to the load, e.g. substantial on-site generator or wholesale purchaser from spot market.

However, the above mentioned person is not the liable person for the load if either:

• the person sells the load to the Australian Energy Market Operator (AEMO)
• AEMO later acquires the load.

In order to satisfy the regulator that the liability has been met, each liable person must surrender the number of GECs (either self-created or purchased through the GEC market) equivalent to the annual GEC liability of the person's liable electricity load and provide a self-assessment report in the approved form to the regulator.

The GECs and self-assessment report must be lodged on or before the compliance date (generally the last business day in April of the year following the liable calendar year).

It will be necessary for liable persons to discuss their liability with the regulator in order to clarify issues such as the liability measurement point and measurement standards or methods.

Other participants

Anyone who has an interest in the scheme can register to be a scheme participant. This is essentially anyone who wishes to acquire and trade GECs.

This type of scheme participant can not create GECs and does not have a liability, but can transfer GECs between other scheme participants.

To become a scheme participant you need to pay the prescribed fee to the regulator and complete the application scheme participant form (Word, 394KB).