Energy Technical and Safety Regulation Discussion Paper – Harmonisation of Energy Supply Industry Technical and Safety Regulation

Ministerial Council on Energy Energy Technical and Safety Leaders Group

February 2009

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Preamble The Energy Technical and Safety Leaders Group The Energy Technical and Safety Leaders Group (Leaders Group) was established by the Ministerial Council on Energy (MCE) Standing Committee of Officials (SCO) in July 2008. On 13 June 2008, the MCE agreed to establish the Leaders Group. The MCE noted the extent to which harmonisation had already been undertaken by the energy supply industry and agreed a working group comprising industry, regulators and unions, should be established to develop a plan to achieve greater harmonisation of State and Territory electricity and gas supply industry technical and safety regulation. The MCE Terms of Reference for the Leaders Group is provided at Appendix 1 and the membership of the Leaders Group is provided at Appendix 2. This paper presents a discussion of the options for the harmonisation of energy technical and safety regulation (refer 'discussion paper') as prepared by the Leaders Group for stakeholder consultation. As the initial paper by the Leaders Group, this paper outlines a high level regulatory framework that takes a management systems approach to regulations. More detail on compliance requirements and the implementation of the proposed model will be provided in supplementary documents (more detail on subsequent documents is provided at the Next Steps chapter, paragraph 191) The proposed regulatory framework outlines an Energy Network Safety System standard (also known as a "safety case") that provides flexibility in requirements for compliance, to accommodate differences in:

• jurisdictional regulatory coverage necessitated by geographic and demographic differences, and

• some established network operational arrangements. The MCE has not considered or endorsed the proposals and options in this paper.

Stakeholder consultation In order to progress the development of the Plan to be presented to MCE, the Leaders Group is seeking stakeholder comment on the proposed regulatory framework and associated options presented for harmonising technical and safety regulation for the energy supply industry. While stakeholder comment is welcome on all aspects of the discussion paper, as highlighted there are a number of issues on which specific comment is requested. This discussion paper has been released for stakeholder consultation on Monday 9 February 2009. Stakeholder submissions should be sent to MCEMarketReform@ret.gov.au and are sought by Friday 3 April 2009. This is to provide stakeholders with an opportunity to comment on the content of this discussion paper taking account of the National Occupational Health and Safety (OHS) Review scoping paper, scheduled to be released mid February 2009. Following stakeholder comments, the Leaders Group proposes to develop a Draft Harmonisation Implementation Plan for stakeholder comments in mid 2009. A consultation Regulatory Impact Statement will be released at the same time. It is expected that a Final Harmonisation Implementation Plan will be presented to MCE at the end of 2009/early 2010. The Final Harmonisation Implementation Plan will contain a detailed strategy for implementation of the recommended framework.

Executive Summary

1. This discussion paper sets out a proposal for progressing a harmonised legislative framework within which State and Territory energy supply industry (ESI) technical and safety regulation will operate.

2. The discussion paper has been developed by the Leaders Group, established on 13

June 2008 by MCE. The content of the discussion paper has not been considered by MCE.

3. The discussion paper has been developed consistent with the principles set out by the

MCE Terms of Reference (See Appendix 1). Taking these principles into account, the options presented in this discussion paper are aimed, to the greatest possible extent at: • putting in place best-practice regulation to ensure public and workers safety; • facilitating greater labour mobility and swifter emergency response, especially in

the context of skilled labour shortages; • lowering the compliance burden for multi-jurisdictional operators; and • providing regulatory certainty and consistency across jurisdictions.

Scope 4. The discussion paper proposes a harmonised approach to ESI technical and safety

regulation covering the following sectors of the energy supply chain: • electricity networks (transmission and distribution); • gas networks (transmission and distribution pipelines); and • electricity generation and gas plants, pending assessment of the level of coverage

provided for in the National Occupational, Health and Safety Review (National OHS Review) as assessed by the Leaders Group.

5. The scope of the discussion paper covers technical and safety regulation in current

State and Territory regulation, and seeks to identify opportunities to harmonise and make improvements where such regulation or variations in industry developed safety-critical work practices impede workforce mobility. However, given different coverage issues in each state and territory, the Leaders Groups will more fully consider this issue in its draft and final implementation plan.

6. While the National OHS Review will look to harmonise OHS regulations which govern

all Australian workplaces, the ESI has special safety and technical requirements and obligations not covered by OHS legislation (e.g. hazards to the public safety arising from energy networks, gas quality standards) that require it to have its own separate, yet consistent and compatible, technical and safety regulatory framework The Leaders Group recognises the interaction between the scope of the National OHS Review with the scope of this discussion paper and will look to ensure the two are complementary.

Regulatory Framework 7. The proposed regulatory framework provides for the delivery of safe energy services.

It seeks to implement a light-handed regulatory approach and flexibility for network operators to innovate and improve efficiency, while facilitating greater labour force mobility. This discussion paper outlines key features of the framework, and presents a number of options for comment by stakeholders. Stakeholders are encouraged to read the executive summary in conjunction with the main body of the report. The key elements of the framework together with the options are summarised briefly below.

Energy Network Safety System (ENSS) 8. The key regulatory instrument within this new, nationally consistent regulatory

framework is the proposed Energy Network Safety System (ENSS), which is consistent with the performance-based safety management systems (also known as a 'safety cases') currently operating in most States and Territories. This light-handed regulatory instrument will place a minimum compliance burden on network operators, while providing the flexibility to implement safe working solutions to maintain worker and community safety standards. There are a number of elements of an ENSS and its coverage which stakeholders are invited to comment on. Some of these are highlighted below.

ENSS Standard

9. It is envisaged that the management systems' requirements of an ENSS electrical standard may be aligned as far as possible with the management requirements of the existing gas standards, AS 2885 and AS 4645, covering gas pipelines and gas distribution as well as other existing standards, thus minimising the development cost to industry. In the longer term, it is envisaged that an ENSS electrical standard and the relevant parts of AS 2885 and AS 4645 may be amalgamated. One key issue identified in the discussion paper is the extent to which it is desirable to develop a generic standard covering the management systems of both gas and electricity networks, so as to facilitate a common ENSS standard for network operators.

Small and Isolated Networks

10. The discussion paper presents options on how small and isolated networks should comply with the general provisions of the ENSS standard. The paper presents two options to either: • require small and isolated network operators to comply in full on the basis that

they will have a very simple ENSS, or, • provide an exemption from the requirements of an ENSS where they are able to

demonstrate compliance with safety outcomes equivalent to an ENSS. Central ENSS Register

11. A Central ENSS Register is proposed to contain a list of third-party certification bodies, accepted or certified energy networks, and information related to the requirements for compliance with the relevant State and Territory legislation and regulation.

Mandatory Standards 12. A key issue for stakeholder comment is the concept of having a limited number of

mandatory standards directly referenced in legislation, particularly in high risk public and workplace safety situations. Two options are presented: • for a select number of safety-critical work practices and technical standards to be

mandatory; or • that there be no specification of mandatory standards other than the ENSS.

Criteria for referencing standards

13. The Leaders Group proposes that a set of principles be established to guide: • what standards need to be developed; • which, if any, standards should be directly referenced in legislation; and, • which, if any, standards should be referenced as “deemed to satisfy” solutions.

Governance Arrangements Ministerial Council on Energy (MCE)

14. The enabling legislation sets out a governance structure with the appropriate separation of powers and oversight for the delivery of safe and efficient energy services. The MCE will represent the interests of each State and Territory in its

decision making role over amendments to be made to the framework. Comment is sought on bringing energy technical and safety issues within the ambit of the MCE.

Advisory/Regulatory Committee

15. Reporting to the MCE, a committee is proposed with the role of monitoring the framework and making recommendations, as well as, having a role in the development of the scheme rules. Two options are presented: • establish an Advisory Committee that is a tripartite body consisting of energy

network regulators, unions and industry representatives; or • establish a Regulatory Committee consisting solely of State and Territory

regulators, that also has an administrative regulatory function, and is supported by a standing Industry Reference Group.

Acceptance/Certification

16. The "certification" and/or "acceptance" process for a network operator’s ENSS will be contained in the Scheme Rules which outlines audit requirements and auditors’ qualifications. The scheme rules are designed to ensure that Regulators will have confidence that certification is fulfilling the regulatory objectives and is undertaken consistently across jurisdictions, providing certainty for network operators. Three options are presented for approval of an ENSS: • certification by a third-party independent certifier; • acceptance by the Regulator, certification by a third-party independent certifier; or, • a two-staged approach to the introduction of the certification system, with

acceptance by the Regulator in the short term, followed by certification of a third-party independent certifier once maturity of the system is ensured.

Enforcement and compliance bodies

17. The Regulators will administer, enforce and apply penalties under the framework. The paper presents three options for the regulatory governance of the safety of the ESI under new uniform legislation: • maintaining multiple jurisdictional regulators but operating under new, uniform

legislation; • as above but implement a ministerial agreement to ensure that regulators operate

in a harmonised way by formalising the role of Electrical Regulatory Authorities Council (ERAC) and Gas Technical Regulators Committee (GTRC) ; or,

• establish a single national regulator with offices in each State and Territory.

Standards Development 18. There are several options identified by the Leaders Group to take forward the

development of standards and/or other normative documents necessary for the harmonisation of the ESI safety and technical regulation. The paper presents four options for the development of standards: • Australian Standards; • National Standards; • Departmental Standards; or, • other documents such as codes, specifications, handbooks and guidelines.

National Energy Skills Passport 19. The recommended development of a National Energy Skills Passport will provide a

mechanism for recording the currency of authorisations, inductions and refresher training for qualified electricity, electrotechnology and gas workers, particularly in areas of training that require periodical updating (refresher training) and that improve worker portability. The passport will be supported by nationally consistent training packages that have already been developed by EE-OZ Training Standards for energy

generation, transmission and distribution, gas transmission and electrotechnology and which reference nationally consistent standards. This will ensure workers in the energy industry have the same base level of training with common generic procedures recognised across jurisdictions.

Legislation 20. Enabling legislation would need to be developed that is nationally consistent and

underpins the harmonisation of ESI technical and safety regulations across State and Territory borders. The discussion paper presents two options: • introduce legislation into State Parliament with a schedule to be adopted

nationally; or, • for each State and Territory to introduce their own legislation based on model

legislation. 21. The legislation will:

• contain a provision for each energy network operator to have an ENSS; • set out a process for verification of the ENSS; • require the ENSS to listed on a central ENSS Register; • describe the roles and responsibilities of an Advisory/Regulatory Committee; and, • may provide the flexibility to allow for mandatory compliance with a limited number of

workplace standards.

Next steps Subsequent Documents 22. This discussion paper is a first step in developing the Harmonisation Implementation

Plan envisaged in the MCE Terms of Reference (See Appendix 1). There are many issues related to implementation that need to be addressed before a comprehensive Harmonisation Plan is finalised and submitted for approval by MCE. Many of these issues are alluded to in this paper and they include the following: • development of a consultation Regulatory Impact Statement (RIS), including a

cost/benefit analysis, intended to be released for stakeholder consultation in conjunction with the Draft Implementation Plan;

• determination of the full scope of the existing State and Territory technical and safety legislation/regulations with the view to identify areas for harmonisation;

• recommendations for the final scope of a national ENSS with addendums of State and Territory additional requirements;

• a protocol for the development of standards for the ENSS; • a first draft version of a standard for the ENSS; • a first version of the Scheme Rules; • a framework for the operation of the Advisory/Regulatory Committee including the

proposed National Register; • legislative mapping; and • EE-OZ assessment of the differing refresher training.

Implementation 23. The Leaders Group has discussed the possibility that the proposed model may be

implemented in stages. Given that the gas industry is more advanced in terms of harmonisation than the electricity industry, the Leaders Group acknowledges that it may be advisable to have a staged approach to implementation. To begin with a stage one approach could be to develop harmonised standards in the electricity industry equivalent to that of the gas industry; at stage two both industries could converge under a harmonised national framework for energy safety and technical regulation.

Stakeholder Comment 24. This feedback will go towards the development of a detailed strategy for

implementation of the proposed model for inclusion in the Implementation Plan. 25. The discussion paper is released for stakeholder consultation for the period Monday 9

February 2009 to Friday 3 April 2009. 26. Following stakeholder comments, the Leaders Group proposes to develop a Draft

Harmonisation Implementation Plan for stakeholder comments in mid 2009. A consultation RIS will be released at the same time.

27. It is expected that a Final Harmonisation Implementation Plan will be presented to

MCE at the end of 2009/early 2010. The Final Harmonisation Implementation Plan will contain a detailed strategy for implementation of the recommended framework.

Table of Contents

Preamble...............................................................................................................................2 Executive Summary ..............................................................................................................3 Table of Contents..................................................................................................................8 Background...........................................................................................................................9 Scope..................................................................................................................................13 Current Arrangements.........................................................................................................15 Guiding Principles ...............................................................................................................19 The Proposed Regulatory Framework ................................................................................21 Passport and Licensing.......................................................................................................30 Standards Development......................................................................................................32 Governance ........................................................................................................................33 Potential Legislative Implementation...................................................................................37 Next Steps ..........................................................................................................................40 Appendix 1: Terms of Reference ........................................................................................42 Appendix 2: Energy Technical and Safety Leaders Group..................................................45 Appendix 3: Use of Standards, Codes, Guidelines & Polices in Australian Legislation in relation to Energy Network Safety.......................................................................................46 Appendix 4: Safety & Technical Issues with Current Regulatory Arrangements .................56 List of Acronyms .................................................................................................................60

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Background 28. In November 2007, the Commonwealth Government committed to work with State and

Territory Governments and the energy sector to improve the consistency of state-based regulations – such as occupational health and safety requirements – that apply to the energy sector.

29. At its 13 June 2008 meeting, the MCE recognised the importance of technical and safety

regulation of the energy supply industry (ESI) to ensure public and worker safety and to enable the provision of efficient energy services. MCE also noted that harmonisation of such regulation is important to: • enable the efficient delivery of energy services; • lower the compliance burden for multi-jurisdictional network operators; and • facilitate greater labour mobility and swifter emergency response, especially in the

context of skilled labour shortages.

30. In this regard, the MCE agreed to establish an Energy Technical and Safety Leaders Group (refer 'the Leaders Group') to develop the Energy Technical and Safety Regulation Harmonisation Enhancement Plan. This discussion paper and the corresponding stakeholder feedback is an important first step in the Harmonisation Implementation Plan.

Purpose 31. This discussion paper seeks to set out possible options for a national framework for the

enhanced harmonisation of ESI technical and safety regulation. This includes recommendations for the legislative framework and the development of referenced standards, as well as, those required to generally support the industry

32. This discussion paper is intended to present a high level framework and options on key

features for stakeholder consultation. Subsequent documents will provide more detail on the operation and implementation of these key features.

33. This discussion paper was developed by the Leaders Group taking into account the

following: • the Terms of Reference for the Leaders Group provided at Appendix 1; • the new governance, institutional and legislative arrangements for the energy sector; • associated energy reform initiatives currently being undertaken by the MCE; and • the COAG Business Regulation and Competition Working Group reforms.

34. In particular this discussion paper is aimed at: • putting in place best-practice regulation to ensure public and workers safety; • lowering the compliance burden for multi-jurisdictional operators; • providing regulatory certainty and consistency across jurisdictions; and • facilitating greater labour mobility and swifter emergency response, especially in the

context of skilled labour shortages.

35. Further work is required in respect of harmonising regulations in order to lower the compliance burden for multi-jurisdictional operators.

Relevant reviews and reforms 36. There are three key concurrent Government reforms which make this the appropriate time

to address the issue of harmonisation in the area of State and Territory ESI technical and safety regulation. These include the National OHS Review, on-going energy market reforms and the COAG decision to introduce a National Licensing System for some occupations.

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These reforms have, or are seeking to, implement a national regulatory framework consistent with the objectives of this discussion paper.

37. When developing this discussion paper the Leaders Group has ensured, to the extent

appropriate, that the recommendations are complementary to these on-going reforms.

National Occupational Health & Safety Review (National OHS Review) 38. On 26 March 2008, COAG agreed to the national harmonisation of OHS laws. The

Commonwealth, States and Territories formalised their commitment to adopting model OHS laws by signing an Intergovernmental Agreement for OHS reform in May 2008. COAG further agreed to accelerate the implementation for national uniformity of OHS laws, bringing it forward by one year to 2011.

39. To carry out the work the Minister for Employment and Workplace Relations, the Hon Julia

Gillard MP, appointed an independent advisory panel (the panel) to conduct a national review to inform the development of a model national OHS Act.

40. The panel has been asked to review State, Territory and Commonwealth OHS legislation

and make recommendations to the Workplace Relations Ministers Council by September 2009 on the optimal structure and content of a model OHS Act that is capable of being adopted in all jurisdictions.

41. In the interim the panel will report to the Workplace Relations Ministers Council at the

beginning of February 2009 on the scope of the national OHS reforms. 42. The development of the National OHS Review has been an important consideration of the

Leaders Group. Throughout this process the Leaders Group has been consulting with the Department of Education, Employment and Workplace Relations (DEEWR) to ensure the path taken by the Leaders Group is consistent with the thinking behind the National OHS review.

43. Initial discussions with DEEWR indicate that the proposed model national OHS Act will

cover general OHS issues of all workplaces. That is, general "slips, trips and falls" type of OHS issues, however, it will not cover energy industry specialist safety issues nor the significant technical and public safety requirements associated with the energy supply sector. As these issues fall outside the ambit of the National OHS Review, the energy supply sector requires its own energy safety legislation. Furthermore, specialist engineering expertise is required to administer such legislation and such expertise is generally not available within the OHS regulatory environment. Currently the energy supply sector is regulated differently in each State and Territory. This is discussed in more detail under the Proposed Regulatory Model at paragraph 102 of the discussion paper.

44. The Leaders Group recognises the need for the proposed regulatory framework in this

discussion paper to be complementary to the model National OHS Act to be developed.

45. Therefore, the Leaders Group recommends that the consultation period for this plan be made over the period when the National OHS Review's scoping paper is released so that stakeholders have the opportunity to consider this discussion paper in light of the scope of the National OHS Review.

Energy Market Reform 46. There have been significant economic reforms to the electricity and gas industries over the

past two decades. These include the establishment of the National Electricity Market (NEM) and the disaggregation of the previously vertically integrated electricity utilities into their respective supply chain elements. This increased competition has delivered real efficiency gains in the energy sector.

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47. The development of the NEM, increased interconnection of energy infrastructure across jurisdictional boundaries and energy companies operating in multiple jurisdictions, has produced an increasing need for national harmonisation and standardisation of energy industry regulation.

48. Energy market reforms have seen the convergence of gas and electricity markets and a

nationally consistent approach to regulatory frameworks and their governance. Recent years have seen the establishment of the Australian Energy Regulator, the Australian Energy Market Commission and the Australian Energy Market Operator (AEMO), along with the development of a National Transmission Planning function within the AEMO and a national framework for reliability standards.

49. In recognition of the increasing interconnected nature of the NEM and its convergence with

the gas sector, the harmonisation of ESI technical and safety regulation, and the reduction in differences across network operators on safety critical work practices, looks to continue these reforms.

50. It is the logical next step that the cohesive operation of the energy market across

jurisdictional borders created through economic reforms, brings into alignment the other regulated parts of the energy supply sector, such as technical and safety regulation.

National Licensing System 51. On 26 March 2008, COAG agreed to explore further enhancements to existing work being

conducted on improving mutual recognition of occupational licences, including line workers, cable jointers, electricians and gas fitters and a possible national system for trade licensing. It asked the Business Regulation and Competition Working Group, with assistance from the COAG Skills Recognition Steering Committee, to develop options for future reform for consideration by COAG in July 2008.

52. In recognition of the inconsistencies of licensing across jurisdictions, the need for

improvements in mutual recognition schemes and to minimise the compliance costs of multiple licensing fees from enterprises, on 3 July 2008 COAG agreed to develop a national trade licensing system with the following characteristics: • a cooperative national legislation; • national governance arrangements; • all current State and Territory licenses being deemed across to the new licensing

system from its commencement; • the establishment of a national public register of licenses; and • no Commonwealth legislative role in the establishment of the new system.

53. The system is to be endorsed in an Intergovernmental Agreement between jurisdictions by COAG during the first half of 2009 and it is not expected that the National Licensing System would commence for any occupational area before 2012.

54. The Leaders Group recognises the implications this reform may ultimately have for the

recognition of qualifications for workers in the ESI. As a result this discussion paper does not attempt to address the licensing issue but focuses on a regulatory framework that facilitates the development of nationally consistent statutory competencies requirements between jurisdictions and segments of the energy supply chain to better enhance workforce mobility and to better recognise refresher training needs.

Importance of the Energy Market 55. With over $98 billion in assets the electricity industry ranks as one of the largest industries in

Australia and contributes 1.5 per cent to Australia's GDP. Australia's efficient and reliable

energy markets underpin the economy and it is essential that Australia looks to continue energy market reforms, such as the harmonisation of safety and technical regulation, to ensure the efficiency of the energy industry into the future.

56. The electricity and gas industries account for approximately 14 percent of engineering and

construction activities in Australia, the third largest after roads and heavy industry (including mining). See Figure 1: Engineering and Construction Activities.

57. There is significant electricity transmission and distribution network and gas pipeline

investment expected over the next five years. In addition, there is likely to be an increase in generation investment in the NEM. These investment trends will be affected by the introduction of the Carbon Pollution Reduction Scheme and the 20 percent by 2020 Renewable Energy Target, which will potentially see a change in the generation mix in the NEM, requiring a substantial build in new generation capacity and connecting transmission. The harmonisation of energy technical and safety regulation will ensure consistent and efficient regulatory framework is in place to facilitate this expected new investment in the ESI.

58. In addition, in June 2008 the MCE committed to a national framework for smart meters.

Jurisdictional commitments are also in place in New South Wales and Victoria with pilots and trails underway. The rollout of smart meters is likely to occur concurrently across jurisdictions and the harmonisation of ESI regulation will be important to facilitate the mobility of workers qualified to install smart meters across Australia.

Figure 1: Engineering and Construction Activities

Investment in Engineering and Construction activities in Australia, by sector

0

5000

10000

15000

20000

25000

30000

1999-00 2001-02 2003-04 2005-06 2007-08 2009-10 2011-12

$ m

illio

n

Roads

Bridges railw ays harbours

Electricity pipelines

Water and sew erage

Telecommunications

Heavy industry incl. mining

Recreation and other

Source: Construction Forecasting Council

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Scope 59. Consistent with the Terms of Reference, the discussion paper proposes a harmonised

approach to energy technical and safety regulation, and possibly safety critical work practices, for the following segments of the energy supply chain: • electricity networks (transmission and distribution); • gas networks (pipelines and distribution); and • electricity generation and gas plants, depending on the level of coverage provided for by

the release of the National Occupational Health and Safety Review (National OHS Review).

60. The retail sector is considered to be outside the scope of this plan, with the exception of the

gas quality function of gas retailers, as their workplace is expected to be covered by the model National OHS Act being developed via the COAG Business Regulation and Competition Working Group.

61. The discussion paper principally covers the harmonisation of the functions of a network

operator, including embedded networks and energy meters (including smart meters), but not consumer installations and appliances. That is, the scope covers all network assets. However, the Leader group also seeks comment on scope and its potential impacts on related technical requirements currently included in State and Territory regulations.

62. A network operator is defined as a person who owns, controls or operates an electricity or

gas network, embedded network, or gas pipeline. Where reference is made to requirements that a network operator is to comply with, such requirements, this is equally applicable to a contactor or subcontractor working for the network operator.

63. The discussion paper covers both safety and technical regulation and other factors which

govern the work practices and infrastructure standards of electricity and gas networks. The discussion paper:

• covers relevant technical regulation, in so far as it is currently covered in State and Territory legislation, and regulation as it relates to safety; and

• seeks to make improvements where technical regulation or variations in industry developed safety critical work practices impede workforce mobility.

64. The discussion paper recognises that a more detailed assessment of the coverage of State

and Territory technical and safety regulation is required to facilitate a more precise statement of the coverage so as to improve regulatory consistency. The Leaders Group will endeavour to do this, following stakeholder consultation, as part of the Final Plan to be presented to MCE and will inform the scope of the legislative architecture.

65. The Leaders Group will give greater consideration to electricity generation, gas plant and

gas retailer issues upon release of the National OHS scoping document in mid February 2009.

66. The discussion paper proposes a management systems approach to regulation. In doing so

it recognises that much of the compliance requirements and implementation details are to be included at a later time in supplementary documents.

67. It is recognised that there are differences in the coverage of State and Territory energy

safety and technical regulation. For example, design standards for a network within a cyclone prone environment would be different in comparison to a network located in area of snowfall. The discussion paper proposes flexibility within the ENSS based regulatory framework and the requirements for compliance with it, so as to accommodate the

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differences in jurisdictional regulatory coverage necessitated by geographic and demographic differences and, to some extent, established network operational arrangements (providing these do not impede skilled labour mobility and flexibility).

68. It is noted that there are inconsistencies between Commonwealth and State processes for environmental and planning regulation that can impact the planning approval process of technical and safety requirements. These issues will however by addressed by COAG, as part of its Business Regulation and Competition work stream which has agreed to reforms including environmental assessment and approval processes.

Stakeholder comments: The Leaders Group seeks stakeholder views on the scope of harmonisation as outlined in the discussion paper, and potential impacts on any related technical requirements that are currently included in State and Territory regulations but are not specifically related to public or worker safety and that cross over into other regulatory spaces, such as reliability and economic regulation.

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Current Arrangements 69. The electricity and gas industry sectors are amongst the most regulated sectors in the

Australian economy. Energy market participants and their employees must comply with economic, planning, construction, safety and technical regulations that apply within each State and Territory they operate in.

70. Currently each State and Territory has its own regulations to govern the safety and

technical requirements of the work carried out in the energy supply sector. Between jurisdictions there are differences in the extent of overlaps in economic and technical/safety regulations, as well as, the extent of coverage provided for by their own workplace OHS legislation.

71. Appendix 3 provides an overview of the standards, codes, guidelines and policies that exist

in each State, Territory and Commonwealth legislation governing the safety of the energy supply industry.

Stakeholder comments: Stakeholder views are sought on the coverage and detail of the descriptions provided for each State, Territory and Commonwealth legislation contained in Appendix 3.

72. There are also differences in the safety regulations between States and Territories. For

example some states have developed their safety regulations to be technology specific, while others are divided into vertical sectors of the supply chain.

73. Further, the Leaders Group recognises that jurisdictional regulators' responsibilities vary. i.e. some regulators have responsibility for reliability and economic regulation while others are solely responsible for safety regulation. This is part of the difficulty in drawing a clear delineation between what regulations can be standardised to provide greater labour force mobility and what is outside the ambit of State and Territory Regulators.

74. Appendix 4 provides some detail on the issues of difference between State and Territory

safety and technical regulation under the current arrangements. However the Leaders Group acknowledges that this information may be incomplete.

Stakeholder comments: Stakeholder views are also sought on the coverage and detail of the current regulatory arrangements contained in Appendix 4.

75. More broadly there are also some differences between the States and Territories in their:

• network safety operating plan requirements; • auditing procedures; • compliance regimes; and • reporting requirements.

76. There are also differences in the degree to which harmonisation of safety and technical

regulation has already taken place between the electricity and gas industries. Gas transmission is more advanced with nationally consistent standards covering pipelines and a nationally consistent training package (UEG06) already in place.

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Problems 77. The differences in industry and enterprise work practices, regulation, training and

authorisation requirements across State and Territory borders and across organisations, have led to a number of inefficiencies in the energy sector. They are described below:

Limits on workforce mobility 78. Historically networks have developed around local arrangements with different equipment

and operations in place. These differences have led to different network requirements within and between jurisdictions. However, with increased interconnectivity of energy markets between States and the increasing use of contractors working in multiple networks the issue of workforce mobility is becoming more pertinent. The different licensing arrangements, refresher training and underpinning documented work practices, standards and guidelines between States and Territories and enterprises means that workers are restricted in terms of which networks or generation facilities they are permitted to operate on.

79. Better mobility of electrical and gas workers across network operators and jurisdictional

borders is necessary to mitigate the effects of labour shortages and reduce workforce bottlenecks.

Example: 80. In the case of generation requirements, different technical and safety requirements in some

jurisdictions act as a barrier to the efficient and effective mobility of tradespeople. The bulk of the technical and safety requirements for generators are covered by general OHS regulations, which currently differ across jurisdictions.

81. In some jurisdictions (i.e. Queensland and Victoria) specific energy technical and safety

regulations apply to electricity generation, however, in other States (i.e. South Australia), requirements are imposed through licensing arrangements, while in other States only the general OHS requirements apply.

82. The steps prescribing how electrical and gas workers perform particular procedures may

vary significantly across jurisdictions and networks. This limits the mutual recognition of a workers competencies and ultimately worker portability. For example, while an electrical line worker can perform the same procedure and get the same outcome as a co-worker in another jurisdiction, as they have been trained differently they would not be permitted to operate outside their home jurisdiction until they were re-trained. An example is polarity testing, which is a simple test performed by electrical line workers to ensure the active, neutral and earthed electrical wires are not incorrectly wired. Steps to perform polarity testing vary from 10 to over 40, depending on which jurisdiction or network you are operating in. Under a harmonised framework with a national training package every electrical line worker would be trained to perform procedures using the same steps and safety standards reducing barriers to workforce mobility.

83. Under the current arrangements all electrical line workers are trained to the identified

qualification of the industry endorsed training package. However, individual network operators and jurisdictions have some specific procedural and regulatory requirements that are unique to their operations and networks. These requirements are not uniform across jurisdictions and add another layer of training to an already existing endorsed National Qualification. For example, organisational differences mean that presently if a line worker from Western Australia moves to Queensland they are required to undertake three weeks training to perform the same operation they did back in Western Australia. This training is not only time consuming but costly, placing a significant compliance burden on network operators. Furthermore, it limits the industry's ability to swiftly respond to an emergency, and is a particular problem for contractors offering services across the country.

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Limits to cross border emergency response 84. Historically, networks have been designed, constructed (with different equipment) and

maintained differently, with different network operator work practices and training, and jurisdictional regulatory requirements. Because of these historical differences there are limitations on the capacity, and safety, of workers to operate across jurisdictional borders. Given these inconsistencies the industry is unable to swiftly respond to an emergency.

Example: 85. The effect of different State and Territory arrangements was demonstrated by a wind storm

in Victoria on 2 April 2008, which resulted in a large number of customers being cut-off electricity supply due to distribution network outages. On that occasion, line workers from other jurisdictions were unable to readily assist restoration of supply in Victoria because of differing work practices. This event highlighted the importance of a standardised approach to safety critical work practices and reducing barriers to labour mobility.

Regulatory inconsistency and compliance burden 86. Numerous gas pipelines and electrical transmission lines cross State and Territory borders

and are subject to different regulations, authorisations and reporting requirements applying to the asset on either side of the border. Multi-jurisdiction network operators are required to meet these differing and duplicative regulatory obligations, placing a large compliance burden on network operators that is both costly and inefficient.

Examples: 87. Within gas distribution there is much variation in regulatory requirements between the

States. Victoria, Western Australia, New South Wales (NSW) and South Australia all have performance-based requirements for network safety and operating plans. Queensland has some prescriptive and minimal performance-based requirements. In addition to these differences compliance and reporting requirements also differ. Overall Victoria and Western Australia are very similar but some of the other States vary much more significantly.

88. These variations cause significant additional burdens for distribution networks that cross

borders. In southern NSW the Albury Gas Company network of 25,000 consumers is effectively just a small part of Envestra's Victorian network of 500,000 consumers. Likewise there are 600 consumers in Tweed Heads that are effectively part of a much larger APA network in Queensland. These small extensions across borders are expected to have separate Safety and Operating Plans, associated compliance audits and Regulatory Reports. This is an unnecessary duplication on behalf of the network operator as these requirements are already adequately addressed by the larger part of their network.

89. In addition, different metering regulations mean that the same gas meters cannot be used

on both sides of the Victorian and NSW border or Queensland and NSW border, thereby imposing a significant cost premium on regional NSW customers.

90. In addition to the differences in requirements for Safety and Operating Plans there is also a

wide variation in compliance regimes. In Victoria and South Australia the technical regulators undertake compliance audits. However, in NSW and Queensland a certificate of compliance from an independent auditor is required. In Western Australia the technical regulator 'approves' changes to such plans, whereas in NSW no approvals are issued for any reason. In Victoria guidance on a range of issues is provided by the Regulator. There is also a wide range of different reporting requirements in each State.

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91. ActewAGL's gas networks, which operate across NSW and Australian Capital Territory borders, reported that the separate OHS Act and Workcover reporting requirements for each jurisdiction places burdensome compliance cost on their operations.1

Stakeholder comments: The Leaders Group seeks comments on the extent of the problem in the current arrangements, and possible approaches to address these issues. The Leaders Group also seeks comments on the above mentioned examples and other examples of limits to labour force mobility, emergency response, regulatory inconsistencies and compliance burden.

Experience of other industries 92. A nationally harmonised framework for technical and safety regulation is consistent with

developments in other Australian industries such as the rail, mining, marine, building and construction and, the offshore petroleum industry. All are moving towards, or have established, a national safety framework to bring about significant improvements to safety records and efficiency for those industries. The National OHS Review recognises industry specific safety requirements, which will operate alongside the National OHS requirements to ensure minimal duplication in the regulatory arrangements.

1 Energy Networks Association Limited, "A policy for a National Framework for Energy Safety in Australia", April 2008.

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Guiding Principles 93. In developing the proposed Regulatory Framework outlined in the next Section, the Leaders

Group has taken the following guiding principles and other factors into account:

MCE – Terms of Reference of the Leaders Group 94. In the development of a harmonised approach to energy technical and safety regulation, the

Leaders Group was guided by the following principles set by the MCE in the Terms of Reference (provided at Appendix 1): • Technical and safety regulation is important for public safety, and to ensure workers

operate within a safe environment and to enable the provision of safe energy services, taking into account that most energy supply industry assets reside in public places.

• Reducing the cost of regulation and the regulatory burden on business, particularly where regulation affects businesses that work across jurisdictional boundaries, without compromising safety outcomes.

• Enhancing productivity and workforce mobility to enable the delivery of efficient network services; lower the compliance burden for multi-jurisdictional operators; and facilitate greater labour mobility and swifter emergency response, especially in the context of skilled labour shortages.

• Regulatory certainty and consistency across all jurisdictions, to the extent appropriate. • Energy specific regulation should not duplicate or be inconsistent with general

Occupational Health and Safety legislation, and the Council of Australian Governments' (COAG) Business Regulation and Competition Working Group's reforms in the harmonisation of general Occupational Health and Safety laws and regulations. This should take into account that most ESI assets reside in public places.

Principles of Good Regulatory Practice 95. In addition to these MCE guiding principles, the Leaders Group has taken into account

principles of good regulatory practice outlined in COAG’s, "Best Practice Regulation: A guide for Ministerial Councils and National Standards Bodies", October 2007. In particular, the key features to be adopted by the Leaders Group include: • regulatory instruments should be performance/outcomes-based, that is, they should

focus on outcomes rather than inputs; • prescriptive ‘deemed to comply’ provisions should only be used in instances where it

can be clearly demonstrated that a prescriptive approach is required for the purposes of ensuring safety;

• the burden on the public and the parties involved should be minimised; and • regulatory measures should contain compliance strategies which ensure the greatest

degree of compliance at the lowest cost to all parties.

96. The Leaders Group recognises that the regulatory framework needs to take into consideration Good Regulatory Practice (GRP) principles as espoused by: • the Productivity Commission (PC); • the World Trade Organization (WTO); • the Organization for Economic Co-operation and Development (OECD); and • the Standards and Conformance Subcommittee of the Asian Pacific Economic

Cooperation (APEC/SCSC).

97. Those GRP principles include: • applying regulations consistently regardless of the size of the organisations involved; • the incorporation of risk management principles, such as those espoused in AS/NZS

4360, Risk Management; and • in cases where risk assessment justifies, a formal accredited independent 3rd party

conformity assessment should be carried out.

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98. In developing the regulatory framework the Leaders Group has also taken the following into account: • The findings of the Review of Australia’s Electrical Equipment Safety System for the

Electrical Regulatory Authorities Council (ERAC) by Conformance and Standards Services (CaSServ), especially the concept of replacing separate State and Territory approvals with a national process.

• The Energy Network Association (ENA) policy statements titled A Policy Framework for Energy Safety in Australia, released April 2008, and Proposed National Framework for Electricity Network Safety, released in July 2008.

• The fact that many energy network operators have existing 3rd party certification schemes in place covering quality, environmental and occupational health and safety management, and thus the imposition of another compatible certified management scheme should not be a burden, especially as it is intended to replace existing less compatible management system (safety case) requirements.

• The principle of the equal validity between the referencing of a standard or other normative document in legislation. That is, a standard that is referenced at the second or third tier level holds the same value as though it was referenced within the legislation itself.

Consistency with the National OHS Review 99. The regulatory framework for the ESI as outlined in this discussion paper is intended to be

complementary to the National OHS model.

100. The energy sector has special requirements compared to those covered in the model national OHS Act that require it to have a separate or subordinate (depending on the outcome of the National OHS review) regulatory framework. Those special requirements are summarised as follows: • Assets are in the public domain: To some extent the model National OHS Act

assumes organisations are working within a controlled environment. In the case of the ESI, specifically network infrastructure, much of the infrastructure is within the public domain. For the model National OHS Act to adequately cover this aspect of the industry, it would require a major modification to the scope of the model National OHS Act to incorporate an extension to include energy infrastructure public safety. This is not a realistic proposition.

• Specialist expertise: To sufficiently ensure the highest standards of safety are maintained in the electricity and gas industries, the specialised technical expertise of the energy sector is required in drafting energy safety and technical regulations. Again this would put an onerous requirement on the OHS sector to accommodate the needs of the energy sector.

• Other industries also have unique requirements: Other sectors such as coal mining, offshore petroleum, chemicals and dangerous goods and maritime, similarly to the energy sector, have specialist requirements and are also requesting that they have an OHS Act specific to their industry. Therefore, it seems likely that the model National OHS Act will need to make similar allowances for a variety of different industries and the energy supply sector is not the only exception to the rule.

101. For the above reasons, it is essential the energy sector picks up the risks not captured by the model National OHS Act in a separate yet consistent regulatory framework. The regulatory model proposed in this discussion paper aims to do this.

Stakeholder comments:

The Leaders Group seeks stakeholder views on the interaction between the scope of the National OHS Review and the scope of this discussion paper, and the potential impact the scoping paper may have on the recommendations and/or options included in the discussion paper. In particular, the Leaders Group seeks comments on whether the proposed approach (potentially isolating the ESI requirements) may introduce undesirable inconsistencies between safety requirements for the ESI and electrical workers outside the ESI.

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The Proposed Regulatory Framework 102. The proposed regulatory model has taken into account principles of good regulatory practice

and governance structures as outlined earlier. The proposed architecture is broken up into the following key parts, as represented in Figure 2 on the next page: • legislation (acts and regulations); • Energy Network Safety System (ENSS); • standards; • acceptance and certification; • Advisory Committee and/or Regulatory Committee; • regulation; and • Central ENSS Register.

103. These are discussed in more detail throughout this chapter and, in some cases, the Leaders Group has presented options on each for stakeholder comment.

104. As noted previously in the Scope chapter, the Leaders Group will give greater consideration

to the application of this proposed regulatory model to the electricity generation, gas plant and gas retailer sectors upon release of the National OHS scoping document in mid February 2009.

Legislation 105. The Leaders Group proposes that the legislation may effectively be a single enabling

instrument effected by each State and Territory. 106. National harmonisation and a consistent regulatory framework is difficult to achieve unless

there is a single enabling legislative mechanism that is not open to the potential of unnecessary differences between jurisdictions. A consistent legislative framework reduces regulatory inconsistency for multi-jurisdictional operators, thereby reducing the compliance burden on the regulated business.

107. Furthermore, a more harmonised regulatory framework for network operators better enables

the mobility of workers between and within jurisdictions and reduces unnecessary regulatory inconsistency and interpretation.

108. As presented in Figure 2 on the next page, the Leaders Group proposes that the legislation: • require each energy network operator to have a Energy Network Safety System

((ENSS) (discussed in detail at paragraph 109) that may comply with a proposed standard for an ENSS. For example, if an Australian Standard was developed it could referenced as AS XXXX ENSS;

• set out a process for verification of the ENSS; • the roles and responsibilities of an Advisory/Regulatory Committee; • provide the flexibility to possibly allow for mandatory compliance with a limited number

of workplace standards that may be essential for worker safety. An option is presented that prescriptive standards covering some issues of public and worker safety, are required to better facilitate inter-jurisdictional worker mobility (see paragraph 129); and

• require the ENSS to be listed on a Central ENSS Register. Stakeholder comments:

The Leaders Group seeks stakeholder views on the content of the legislation and what, if any, further matters should be addressed in the legislation Stakeholder views are also sought on basing the legislation on the concept of compliance with a national ENSS standard.

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Figure 2: Elements of the Proposed Regulatory Model

MCE Decision-makers

Legislation

Broad Framework ENSS Compliance

Certification Compliance

Regulators Enforcement

Apply Penalties

Advisory/Regulatory Committee

Monitor and recommend changes to the framework

and standards

Regulation Penalty provisions Enforcement Regime Compliance Regime National Register

Option for some Mandatory Standards and other

Normative Documents

Based on the principle of addressing substantial public

or worker safety

Scheme Rules Outlines:

who audits, qualifications required; how; and frequency.

Verification by

3rd Party Independent Certification or Approved

by Regulator

Certification Energy Network Safety System

Performance-based Standard AS XXXX ENSS, plus

"deemed to satisfy" Standards or Alternate Solutions

Electricity Distribution

Electricity Transmission

Gas Pipelines

Gas Distribution

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Energy Network Safety System 109. The term “Energy Network Safety System (ENSS)” is used in the proposed regulatory model

in place of the term “Safety Case”, or, "Safety Operating System" or "Management System", these being performance-based management systems commonly referred to by States and Territories.

110. The proposed ENSS will:

• describe the full extent of all relevant operations; • identify all hazards related to designing, constructing, operating and maintaining the

energy network (all hazards approach); • detail and systematically assess the risk associated, with those hazards; • identify the control measures that will reduce risk to As Low As Reasonably Practicable

(ALARP); • document relevant safety related standards, any departures and how equal or better

outcomes will be achieved; and • apply an ENSS to ensure the controls are effectively and consistently applied and

performance is measured and continuously improved. 111. Currently, performance-based management systems, such as the proposed ENSS, are

used to regulate energy technical and safety of networks and facilities in most, if not all, States and Territories. Each management system may vary slightly in the way it is managed but given the commonality between jurisdictions, there is agreement amongst the members of the Leaders Group that a uniform performance-based management system should be applied across all jurisdictions.

112. The proposed ENSS based regulatory approach is a relatively light-handed regulatory

approach (as per COAG best-practice regulatory principles) that encourages industry to improve the efficiency of its operation without compromising safety. An ENSS provides industry with an alternative to complying with prescribed standards or other requirements by allowing alternate solutions, except for the potential option of a limited number of mandatory safety critical work practice standards directly referenced in legislation.

113. Under the proposed regulatory framework the ENSS, and compliance with it, will be directly

referenced in nationally consistent legislation and would be the chief health and safety document for a network or facility. It would document the operator’s commitments to reducing risks to a level that is as low as reasonably practicable. The ENSS would also describe arrangements for health and safety that are used by managers, supervisors and the workforce to understand health and safety issues and their controls. It should be noted however, that this does not mean that the ENSS obviates compliance with the specific requirements of the general OHS legislation in each jurisdiction.

114. Under this framework, various obligations for the health and safety of persons working on

networks or facilities rest with the operators, employers and employees. 115. The proposed ENSS should serve to minimise the regulatory burden on business through its

compatibility with current “Safety Case” regulatory arrangements in the energy supply industry and the fact that many network operators already have other certified management systems in place.

Stakeholder comments:

The Leaders Group seeks stakeholder views on the proposed Energy Network Safety System and its coverage.

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Standards and other normative documents Definitions

116. The word “standard” is used throughout this document within the following definitions: • Performance standards or other normative documents define an end result and allow

flexibility on how that result is achieved. An example of a requirement in a performance standard would be: "An operative should be free from risk of electrocution when performing some function".

• Prescriptive standards or other normative documents may define exactly how to do something - they are like a set of instructions. A prescriptive standard may allow little or no flexibility on how the end result is achieved. An example of a requirement in a prescriptive standard would be: "minimum safety clearances in high voltage substations such as an operative shall maintain a distance of xx metres from live parts”

• “Deemed to satisfy” standards can be a performance or prescriptive standard or other normative document that gives an option on how a requirement(s) of a performance standard may be achieved. “Deemed-to-satisfy” standards are standards that have been developed and tested and are known to provide a level of safety. They are prescriptive solutions for: – use by those requiring to comply that want to have certainty of compliance or simplicity in achieving the same outcomes, especially for smaller operators; and - used as benchmarks when alternative solutions are being assessed for acceptance against performance requirements. The benefit of adopting a “deemed to satisfy” standard is that there is no onus on the applicant to prove that the solution meets the corresponding performance standard. In the examples for performance and prescriptive standards given above, the prescriptive requirement may be a “deemed to satisfy” solution to the performance requirement.

• Alternate solutions can be formulated as an alternative to the "deemed to satisfy" solution to meet the required outcomes. An alternate solution must be demonstrated to satisfy the required outcomes, either directly or by showing its performance is at least equivalent or better than that of the "deemed to satisfy" solution. The benefit of using an alternate solution is that it greatly increases the options available for achieving the required outcome, allowing for innovations and the adoption of new technology. However, in adopting an alternate solution, the applicant must bear the cost of demonstrating that the alternate solution meets the applicable required outcomes.

• Other normative documents describe a standards-like document that has been developed and published by a relevant stakeholder and is considered to be authoritative by all stakeholders. These may include documents developed by the Energy Networks Association and State and Territory Regulatory Authorities.

117. Presently most States and Territories use the "safety case" (ENSS type of) approach and

use a mixture of existing prescriptive and performance standards as well as industry guidelines as benchmarks to assess the adequacy of "safety cases".

ENSS management system standard 118. The proposed regulatory model may consist of a suite of documentation including:

• for electricity networks a new Australian Standard AS XXXX, Electrical Network Safety System (ENSS), that consists of Part 1 covering management systems requirements plus Parts 2 and 3 covering additional operational requirements for electricity transmission and distribution networks; and

• for gas networks, the existing standards, AS 2885 and AS 4645, covering gas pipelines and gas distribution.

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119. It is envisaged that the management systems' requirements of the electrical standard AS XXXX, ENSS, may be aligned, as far as possible, with the management requirements of the existing gas standards, AS 2885 and AS 4645, covering gas pipelines and gas distribution as well as other existing standards, and thus minimise the development cost to industry.

120. In the longer term, it is envisaged that AS XXXX, ENSS, and the relevant parts of AS 2885 and AS 4645 may be amalgamated to form a generic standard covering the management systems of both gas and electricity networks to facilitate a common ENSS for network operators involved in both gas and electricity supply. The operational requirements of AS 2885 and AS 4645 will be retained as separate parts of the amalgamated standard.

121. Information on the options available for developing standards and other normative documents is contained in the Standards Development chapter at paragraph 152.

Stakeholder comments: Stakeholder comments are sought on whether it is desirable to develop a generic standard covering the management systems of both gas and electricity networks, so as to facilitate a common ENSS standard for network operators.

Features of the ENSS 122. A safety management system approach is proposed as it is performance-based allowing

alternate solutions to “deemed to satisfy” prescriptive standards, adopts contemporary risk management principles, and is likely to be compatible with a solution accepted under the proposed National OHS Act.

123. AS XXXX, ENSS, will be a performance standard and will permit alternate solutions to

achieve its performance requirements. For some outcomes AS XXXX, ENSS, may specify, as one of a number of alternate solutions, prescriptive or performance standards as “deemed to satisfy” solutions to the specified performance or outcome requirements

124. The provision of alternate solutions is an important feature of the model because it allows

network operators to innovate and improve efficiency, while ensuring the same safe outcome is achieved across all network operators. Likewise the provision of “deemed to satisfy” standards provides benchmarks for the development of training packages. The extent to which safety critical work practices standards may be allowed to be varied under this framework is one of the issues on which stakeholder comment is sought.

125. The ENSS standard is to specify compliance with the legislation which may reference some

mandatory standards.

Small and Isolated Networks 126. An issue arising out of a safety management system approach is how small and isolated

networks should be treated under the proposed regime. The Leaders Group has identified two options as follows:

Option 1: Require small and isolated network operators to comply in full with the requirements of the ENSS on the basis that they will have a very simple ENSS.

This option supports good regulatory practice which states that regulation should be applied consistently to organisations regardless of the size of the organisations involved.

Option 2: Provide an exemption from the requirements of an ENSS for small and/or isolated network operators able to demonstrate compliance with safety outcomes equivalent to those achieved when a formal Accepted or Certified ENSS is in place.

This exemption is intended to capture small, isolated and remote networks with few customers to whom, developing a formal ENSS may place an unjustifiably large regulatory

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burden on them given their size. These alternate arrangements would need to include mandating the safety critical work practices standards so as to deal with worker mobility concerns.

127. The specification of “deemed to satisfy” standards in AS XXX, ENSS, is especially important for smaller network operations where the ENSS will usually rely more on “deemed to satisfy” standards, while larger network operators will usually rely more on alternate solutions.

128. The provision of "deemed to satisfy" standards will reduce regulatory compliance on small and/or isolated networks by allowing them to submit a prepared ENSS without the requirement to fully develop one on their own.

Stakeholders Comments The Leaders Group seeks views on the two options for the treatment of small and isolated networks. If an exemption is permitted for small and isolated networks, the Leaders Group seeks views on the definition of a “small and isolated network”? The Leaders Group also seeks views on whether or not either of these options should also be applied to small embedded networks.

Mandatory standards 129. A key issue for stakeholder comment is the concept of having a limited number of

mandatory standards referenced in legislation. 130. Appendix 3 is an initial overview of the use of standards, codes, guidelines and policies in

Australian legislation as they relate to energy network safety. Energy Network Safety Systems (or schemes) are required to be performance based either by legislative design or reference to risk management, performance based codes and standards such as the pipeline standard AS2885.

131. Where standards and codes are mandated, legislation is increasingly allowing alternative

safety management schemes. For example, in Victoria an electricity network operator seeking to establish a safety management scheme must demonstrate in detail how its adopted Standards and Codes meet or better the safety outcomes and objectives of the legislation through the operation and management of that scheme. Regulators in turn must ensure that Standard and Code outcomes appropriately deal with the safety and consistency issues.

132. This is consistent with OHS legislation which allows support by codes of practice. A code is

a source of practical guidance on safe work practices and risk management in relation to specific hazards and/or hazardous activities. A code may or may not reference other standards or codes. A code aims to ensure that adequate health and safety standards are implemented on specific OHS matters, whilst allowing flexibility for a duty holder to incorporate new inventions and technological changes that are most appropriate for their workplace, provided they do not reduce health and safety or the consistency of standards. Duty holders must comply with a code unless they identify another way of achieving the same or better safety standards than those prescribed in a code.

133. The issue centres on how best to ensure employers and employees comply with all

appropriate safety and consistency related standards in an environment where safety legislation is already increasingly encouraging the development and application of enterprise safety management systems (or schemes) which incorporate appropriate standards. In addition, an important issue in reviewing the current framework is how best to

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ensure the objective of workforce mobility in emergency situations is achieved as well as ensuring efficient operation of the network through increasingly consistent technical and regulatory requirements. This has led to the following options: Option 1. The specification of a limited number of justified mandatory standards in legislation, particularly in high risk public and workplace safety situations. This will ensure that there is consistency in safe work practices nationally which is one factor to enable greater portability of workers. It is suggested that there will have to be consistent safety compliance models as mobility of workers cannot be achieved through a performance-based model approach that allows alternate solutions to the specified “deemed to satisfy” standards. This option also allows, in the longer term, for more consistent technical requirements to apply to network operators. As part of this option it is also suggested that it is inefficient to have individual network operators use varying in-house safety critical work practices standards, as the development of good industry practice on such safety critical matters should be done in a test environment, on behalf of the wider industry, and introduced on a standardised basis once thoroughly evaluated. Option 2. No specification of mandatory standards other than for the ENSS. It is argued that mandatory standards will add a significant layer of complexity and take time to make revisions to, and this will create a barrier to the ongoing development of good safety practices and innovation in the industry. It is suggested that option 2 will ensure employers and employees comply with all appropriate safety and consistency related standards, and will produce a more positive and beneficial outcome than mandating standards. It is further suggested that the high level of safety in the industry will be better maintained and improved by requiring network operators and the Regulator and/or certifier to ensure compliance with all appropriate safety and consistency related standards (of which Australian Standards only constitute one part) by: • network operators, through the development and implementation of an ENSS that will

ensure an equal or better outcome; and • the Regulator and/or certifier ensuring that relevant published safety and consistency

related standards have been appropriately considered in the ENSS. 134. Noting these views, in developing standards the Leaders Group proposes adopting a

performance-based model allowing alternate solutions to the “deemed to satisfy” standards, or other normative documents, except in high-risk public and workplace safety situations, where a limited number of mandatory standards for safety-critical requirements or work practices may be justified as necessary. The key issue is: what is the basis or criteria for determining what, if any, such standards are referenced in legislation?

Stakeholder comments: The Leaders Group seeks views on the two options presented with respect to the issue of mandatory standards.

Criteria/principles for developing and referencing standards 135. The Leaders Group proposes that a set of principles be established for the selection of

standards to guide: • what standards need to be developed; • which, if any, standards should be directly referenced in legislation, and • which, if any, standards should be referenced as “deemed to satisfy” solutions in AS

XXXX, ENSS, and, if needed, in AS2885 and AS 4645.

136. It is essential that any criteria for selection of mandatory standards be based on the MCE principle of “importance for public safety and to ensure workers operate in a safe environment, as well as, enable the provision of safe energy services”.

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137. Under a "deemed-to-comply” approach, the development of criteria for referencing standards and other normative documents in the ENSS either directly as mandatory standards or “deemed to satisfy” solutions in the performance based AS XXXX, ENSS, is required.

Stakeholder comments: Stakeholder views are sought on criteria to guide: • the development of standards; and • the referencing of standards or other normative documents as mandatory

standards or "deemed to satisfy” standards. Any such recommendations must be accompanied by justification in terms of the COAG Best Practice Regulation criteria.

Acceptance/Certification 138. A key issue in the energy technical and safety regulatory framework is what the appropriate

"acceptance" or "certification" model should be for a network operator's ENSS. The Leaders Group has identified three options as follows: Option 1: Compliance of a network operator’s ENSS is achieved through an authoritative system of auditing by 3rd party certification bodies accredited by the Joint Accreditation System of Australia and New Zealand (JAS-ANZ), using industry-wide developed scheme rules and underpinned by the international best-practice procedures and standards of the International Accreditation Forum (IAF) and the International Organization for Standardization (ISO). Under this arrangement, underpinned by an agreement with JAS-ANZ, audits would be conducted with a technical specialist from the relevant regulators as member(s) of the audit team, and the results of such certification would be automatically accepted by the Regulators without any further regulatory action. The advantages of this option include: • the ability of 3rd party certification audits to be integrated with audits of other

management systems covering such things as quality, environment and OH&S; and, • the independence, international basis and consistency of the JAS-ANZ accreditation

system. Option 2: Under this option the network operator is required to submit their ENSS and audit report from an independent auditor (who may or may not be accredited by JAS-ANZ) to a relevant regulator for acceptance. This proposal envisages the establishment of protocols that enable one regulator to grant approval on behalf of all jurisdictions in which the network operator’s networks exist. The advantages of Option 2 include: • a higher level of retention of experienced staff in the State and Territory regulators; and • a capacity for greater flexibility in the documented ENSS. Option 3: Is to implement option 2 initially, with option 1 coming into place as an alternative to option 2 after a period of time. This two-staged approach to the introduction of the certification system is intended to ensure the maturity of any new 3rd party certification system before Regulators cease control over the acceptance process. Under this option, an Advisory/Regulatory Committee (see chapter on Governance for an explanation of the Advisory/Regulatory Committee), after some years of satisfactory operation of option 2, would consider including option 1. The advantages of this option is its staged approach provides time for any new 3rd party certification system to establish itself and ensure full confidence in the new system before transitioning to it.

Stakeholder comments: The Leaders Group seeks views on the three options for "acceptance" or "certification" of a network operators ENSS.

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Regulation 139. Working alongside the legislation, the Leaders Group proposes that common regulation be

developed under the auspices of the MCE, upon advice of the Advisory/Regulatory Committee. It is proposed that the regulations cover issues such as penalties and enforcement where there is non-compliance with the requirement of acceptance or certification.

Central ENSS Register 140. A publicly accessible Central Register is to be maintained by the Advisory/Regulatory

Committee with entries to be made by: • the relevant Regulator under the Acceptance arrangements; and • when it is introduced, network operators under the Certification arrangements

141. The Central ENSS Register would contain the following:

• a list of 3rd party certification bodies accredited to certify the ENSS of energy networks; • a list of energy networks accepted by Regulators or certified by certification bodies; • information related to the requirements for compliance with the relevant State and

Territory legislation and regulation; and • registration of jurisdictional coverage to assist with transparency of the regulatory

framework.

142. Entry of energy networks on the Central ENSS Register will, in effect, be the trigger for recognition as “approval” by the legislation enacted in those States and Territories covered by their Acceptance or Certification. The Central ENSS Register will assist the transparency of the proposed regulatory arrangements.

Stakeholder comments: The Leaders Group seeks stakeholder comments on the need for the proposed Central ENSS Register and its contents.

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Passport and Licensing 143. As outlined previously, a difficulty with the current regulatory arrangements in the ESI is the

limits to workforce mobility across jurisdictions. This is due to different licensing arrangements, underpinning documented work practices, standards and guidelines between States and Territories and network operators which restricts the networks or generation facilities that workers are permitted to operate on. In addition, these differences can place considerable compliance costs on enterprises, particularly significant for small to medium enterprises and there is also the indirect cost of managing these systems.

144. Each State and Territory maintains independent licensing regimes. Licensees have to pay a

separate fee for the equivalent license(s) in each jurisdiction. On top of different licensing systems in jurisdictions some States and Territories also have different skills recognition of electrical workers. For example: • New South Wales and Western Australia have no licenses for electrical line and cable

jointer workers; • Queensland has licensing and is the Queensland industry is presently trialling a

passport system; • Victoria has a registration process, (industry agreement not controlled by legislation)

and an established Passport system; • the Australian Capital Territory is currently in the process of introducing licensing; • the Tasmanian Government has introduced licensing of line workers and cable jointers

and has an established industry Passport system; • South Australia apply licensing only to contractors and not employees of ETSA; and • the Northern Territory has licensing.

145. There currently exist nationally consistent training packages for qualifications in the energy

supply industry developed by EE-OZ Training Standards e.g. UET06-ESI-TDR for the transmission, distribution and rail industry, UEG06 for the Gas Industry and UEE07 for the Electrotechnology Industry. However, once an operative in the industry, such as an electrical worker, undertakes training that is specific to each network the inconsistencies in this specific training limits the portability of workers.

146. Work towards addressing this issue is already underway with the announcement of the

project to assess statutory competencies requirements in October 2008, to be carried out by EE-OZ Training Standards, in partnership with the CEPU, ENA and DEEWR, which will identify and map the commonalities across the networks of this specific training.

147. The EE-Oz project aims to improve the consistency and quality of statutory competencies requirements in the electricity supply industry between States and Territories, as a first step toward eliminating inconsistency in refresher training. The project will identify and seek to resolve the differences in requirements that impede an enterprise or a contractor's employee from performing work on electricity supply infrastructure across network operators and jurisdictions.

148. To record the currency of qualified electrical workers, particularly the refresher training they

have undertaken, the Leaders Group recommends the introduction of a National Energy Skills Passport. When in operation the passport will provide a smartcard (or similar documentation) to workers which will contain their identification and record the currency of authorisations , inductions and refresher training.

149. In the context of this concurrent reform the Leaders Group accepts that the licensing issue

may be addressed through the COAG National Licensing System and therefore is focusing on the development of a passport that complements the COAG reform process.

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150. AS XXXX, ENSS will also require workers undertaking specified tasks to have relevant

competencies. To facilitate the maximum portability of competencies, this may be achieved by workers having national qualifications and/or a national licence and/or a national passport.

151. A National Energy Skills Passport and its reference in the ENSS will enhance productivity

and worker mobility.

Stakeholder comments: Stakeholder comment is sought on the proposal for a National Energy Skills Passport. Stakeholder comment is also sought on what additional steps, particularly to industry work practices, are required to facilitate greater portability of ESI workers.

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Standards Development 152. This chapter presents options for the development of standards. The previous chapters

have discussed how standards and other normative documents may be referenced.

Identification of Options 153. There are several options identified by the Leaders Group to take forward the development

of standards and/or other normative documents necessary for the harmonisation of the ESI safety and technical regulation.

154. The Leaders Group has identified the following factors for assessing the different options

available to develop standards: • development time; • credibility of the standards in the marketplace and thus their acceptability in

regulations; • level of stakeholder ownership of the process, including a consensus on outcomes; • the need to have substantial stakeholder involvement in the standards development

process; • given that some of the required standards already exist as Australian Standards

developed by Standards Australia, the preference to maintain a consistent approach in their development; and

• where possible, national standards should be aligned with international standards in accordance with Australia’s commitment to the WTO TBT Code.

155. Deliverables can be developed as one or more of the following :

1. Australian Standards® developed by Standards Australia, or under the auspices of Standards Australia. Standards Australia is considered to be Australia's peak non Government standards body. In developing Australian Standards, Standards Australia prioritises the development of standards based on an assessment of their Net Benefit to the Australian community and resource support from stakeholders. Under its New Business Model introduced in late 2008, Standards Australia provides a number of pathways for developing Australian Standards that require the provision of varying levels of resources by those proposing the development of Australian Standards. There was a level of support within the Leaders Group for the development of the required standards as Australian Standards. Another option with the Standards Australia model is the formation of a Standards Development Organisation (SDO) that is accredited to develop Australian Standards by the (Standards Australia) Accreditation Body for Standards Development Organisations (ABSDO);

2. National Standards developed under the auspices of the MCE. National Standards would be developed by an entity (eg Energy Technical and Safety Leaders Group or other relevant industry body) set up as a Standards Development Organisation (SDO) without accreditation and then using consultant(s) to develop reasonably mature drafts for submission to Leaders Group and the MCE for approval as National Standards;

3. Departmental Standards: Contract a consultant(s) (that could include Standards Australia) to develop Departmental Standard with the Leaders Group as advisors: or

4. Other Documents such as codes, specifications, handbooks and guidelines under a different arrangement.

Stakeholder comments: Comment is sought on the preferred option for the development of standards and other normative documents required for the proposed regulatory model.

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Governance 156. This section considers governance arrangements for energy technical and safety issues.

Under current arrangements, energy technical and safety regulation does not fall within the ambit of all MCE Ministers. These responsibilities vary across States and Territories. Further, as reflected in Appendix 3, the governance framework and regulatory arrangements differ between States and Territories.

157. In developing a proposed governance framework, the Leaders Group has looked to ensure

integrity in the governance arrangements for the safety of the energy sector and appropriate separation of duties. The Leaders Group has considered governance and framework issues in related areas, such as the energy economic regulatory framework and the resources sector.

158. A robust governance model is important to enable the proposed model to effectively operate

and allow the framework to evolve as needed. This will also better enable consistency in the regulatory arrangements and practices, reducing regulatory inconsistencies and regulatory compliance for multi-jurisdictional operators.

Ministerial Council of Energy 159. Under the proposed model, the MCE will have policy coverage on safety and technical

regulation where previously they have not. It is recognised that not all MCE Ministers have responsibility for these issues and that a shift in responsibility or advisory role may be required by MCE Ministers.

160. The function of the MCE will be to make decisions on the recommendations put to them by

the Advisory/Regulatory Committee. They will include matters such as changes to, or the development of, new regulation or standards and any other pertinent matter related to safety of the energy sector.

161. The MCE is not obligated to act on the advice of the Advisory/Regulatory Committee and

can take other independent advice. 162. The MCE will provide a consensus decision making body that represents the interests of

each state and territory. The MCE may direct the Advisory/Regulatory Committee to review the effectiveness of the regulatory framework on issues such as: • the extent to which safety objectives are being met; • potential barriers to workforce mobility; • capacity to effectively respond to an emergency; • the extent that unnecessary regulatory burden/overlap may exist; or • any other matter to the discretion of the MCE.

163. Bringing energy supply technical and safety issues within the ambit of the MCE better

enable such issues to be considered in a holistic manner taking account of jurisdiction specific issues where necessary. This approach will also enable consideration to be given to interactions with National OHS requirements.

Stakeholder comments: The Leaders Group seeks comments on bringing energy supply technical and safety issues within the ambit of the MCE.

Advisory/Regulatory Committee 164. As outlined previously, the Advisory/Regulatory Committee would monitor and recommend

changes to be made to the regulatory framework to improve efficiency and ensure safety. 165. The Advisory/Regulatory Committee would be responsible for the ongoing development and

maintenance of the energy safety, compliance and enforcement framework under the guidance of COAG and MCE and in consultation with occupational health and safety agencies.

166. The Advisory/Regulatory Committee would have the authority to: propose legislative or

regulatory changes and new or revised standards; introduce temporary emergency measures; and administer any problems with the certification process and set out the penalty regime.

167. MCE would not be obligated to act on the advice of the Advisory Committee or Regulatory

Committee (if required) and can take other independent advice.

168. The Advisory/Regulatory Committee would: • report to the MCE; • have the role of proposing any legislative or regulatory changes and new or revised

standards and other normative documents; • have the authority to introduce temporary emergency measures; • be chaired by an independent industry based nominee of the MCE; • administer any problems with the certification process and penalty regime; and • may maintain an agreement with JAS-ANZ relating to the conduct of the ENSS

certification scheme. 169. The key issue is how to best manage the regulatory framework in an ongoing sense, once

established. The Leaders Group has identified two options for comment: Option 1: Advisory Committee The Advisory Committee would be established as a tripartite body with members similar to that of the Leaders Group consisting of nominated representatives of energy network regulators, unions and industry representatives. The benefit of option 1 is it's a tripartite body giving all representatives an equal seat at the table when reporting to MCE, thus promoting more comprehensive advice and greater ownership by stakeholders than would be the case under an alternative arrangement. This in itself may present difficulty in reaching consensus. Figure 3: Option 1, Advisory Committee reporting lines

Standing Committee of Officials

Advisory Committee Consisting of Industry, Union and Regulatory

Representatives

Ministerial Council on Energy

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Option 2. Regulatory Committee A body consisting solely of State and Territory regulators in the absence of a national regulator. This body would be in two parts (one for electricity and one for gas) and would effectively formalise the roles of the Electrical Regulatory Authorities Council (ERAC) and the Gas Technical Regulators Committee (GTRC) by giving them clear reporting lines to the MCE, via representation on SCO. Sitting below the Regulatory Advisory Committee would be a standing Industry Reference Group who would advise the Regulatory Committee of the implementation and on-going improvements that may be required to ensure the frameworks effective operation. The benefit of Option 2 is it will give the existing gas and electricity regulatory committees official reporting lines for their work and improve the effectiveness of the committees. The Industry Reference Group would be formally established in two parts: one for electricity and one for gas supply systems. It would provide direct feedback on the effectiveness and efficiency of the regulatory framework. However should a single national regulator for the safety of the ESI eventuate; the functions of the Regulatory Committee could be rolled into the functions of the National Regulators. This is discussed more in the next sections, Enforcement and Compliance Bodies. Figure 4: Option 2, Regulatory Committee reporting lines

Stakeholder comments: The Leaders Group seeks comment on the need for an Advisory/Regulatory Committee, its representation and accordingly what should its role be?

Ministerial Council on Energy

Standing Committee of Officials

Regulatory Committee Consisting solely of

Regulatory Representatives

Industry Reference Group Consisting of Industry and Union

Representatives

Enforcement and Compliance Bodies (Regulators) 170. At present there are multiple energy safety regulators across States and Territories. 171. The Leaders Group recognise that many of the activities of a technical and safety regulator

require a local presence. For example, many existing electrical regulators’ activities include: • dealing with public safety concerns; • dealing with issues associated with working in proximity to powerlines; • building and structure clearance issues; • vegetation clearance issues; • auditing of network safety cases; • enforcement activities;

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• safety promotion; and • incident investigation and follow-up.

172. All of these activities require the ability to visit the site of interest and talk directly to local

representatives with real decision-making capability on-site. To accommodate this each of the three options proposed maintain some form of local presence.

173. The Leaders Group outlines the following three options for the regulatory governance of the

ESI: Option 1: Essentially status quo, which is maintaining the existing multiple jurisdictional regulators but operating under new, uniform legislation, identical in each jurisdiction. Under this option future legislation changes would have to be collectively agreed and approved by the MCE. Maintaining multiple regulators would continue the professional and focused expertise and regulatory cultures specific to the regulators jurisdiction and, thereby ensure accurate dealings of issues within that jurisdiction. On the other hand, as proven to date, having local regulators can also be a factor in the divergence of consistent regulation and its interpretation between jurisdictions. This can increase the administrative burden on network operators that operate across jurisdictions and that need to engage with different regulators to seek regulatory acceptance. Option 2: As per Option 1, but also implement a ministerial agreement to ensure that Regulators operate in a highly harmonised way by formalising the role of ERAC and GTRC. Under this option the Regulators would be required to report on policy and operations to the MCE via two national management committees, one for electricity supply and the other for gas supply (each established as a formal committee under the MCE, reporting directly to the MCE). These national committees could eventually take over the function of ERAC and GTRC and would replace the need for the Regulatory Committee as outlined in Option 2 of the previous section. Option 2 is seen to provide a compromise between option 1, maintaining autonomous State and Territory Regulators and Option 3, moving to a single national regulator. It provides the benefit of continuing the existing regulatory governance arrangements and thus retaining the existing professional culture and focused expertise, which have been proven to ensure high levels of safety are maintained in the ESI. Option 3: A single national regulator with offices in each jurisdiction. This option would require the creation of a new central body that reports to the MCE via an independent board. A single regulator concentrates technical and safety regulatory experience for the energy sector in one agency, thereby harnessing expertise and synergies, provides a single contact point for the energy sector for energy safety regulatory matters, and ensures consistency in regulation while addressing the unique aspects of a network operator. Furthermore in moving to a single national regulator consideration needs to be given to the differing elements of functions of responsibility between each State and Territory regulators. That is, the different coverage of the energy supply chain each jurisdiction regulator has, including coverage of the ESI, the electrical industry “beyond the meter” (installations in buildings, factories, marinas, etc), trade and business licensing, and equipment and appliances. Removal of any one element of this from the responsibility of the existing jurisdictional regulators would require the reassessment of the impact on the rest of the electrical regulation framework as staff are often shared across areas of responsibility.

Stakeholder comments: The Leaders Group seeks comment on the proposed governance framework for energy technical and safety regulation, the options presented and any other options.

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Potential Legislative Implementation This section presents the options for the legislative architecture of energy technical and safety regulation.

Legal Options 174. The Leaders Group proposes that the objective should be to have a national legislative

framework covering technical and safety issues in both the gas and electricity industries. 175. This legislation should complement and operate alongside the National OHS model

legislation. More detail about how energy safety and technical legislation will interact with the National OHS framework will become clear after the release of the National OHS Review's scoping paper.

176. There are a number of options available for the adoption of a national framework for energy

technical and safety regulation. No decision has been made at this stage as to which is the most appropriate option for this purpose. To a large extent, this decision will depend on the decisions that are ultimately made about the overall regulatory framework, in particular, in respect of its governance arrangements and the role of the regulator(s). Two potential options for a national legislative framework have been set out below for the purpose of demonstrating how a co-operative scheme may be achieved. However, other options may be considered by the Leaders Group as it contemplates the most appropriate legislative framework for this reform project.

Option 1: Legislation introduced into State Parliament with a schedule to be adopted nationally

177. Energy technical and safety legislation could borrow from the example of the co-operative legislative scheme that introduced the National Electricity Law.

178. The National Electricity Law is set out in a Schedule to the National Electricity (South

Australia) Act 1996, which came into operation in December 1998. It is applied as a law of South Australia by that Act, and as a law of other participating jurisdictions by their Application Acts.2 A similar model applies for the National Gas Law.

179. In relation to energy technical and safety regulation, there presently exists multiple Acts in

each State and Territory with, at a minimum, one Act to regulate technical and safety issues for the electricity industry and a separate Act to regulate similar issues for the gas industry.

180. Option 1 would see the agreed framework for the regulation of technical and safety issues

applied in an identical way in all participating States and Territories. The experience of implementating the National Electricity and Gas Laws has demonstrated that a model requiring jurisdictions adopt a 'template' Act demands a commitment on their part to resolving areas of disagreement before the framework is implemented. This serves to reduce the likelihood that States and Territories may individually seek to deviate from the national approach.

181. In addition, where it is agreed that amendments to the framework are required, only the lead legislature will have to pass the amending legislation through its parliament. The changes to the framework simultaneously become effective in the other jurisdictions by operation of their Application Acts. This process avoids inconsistencies arising between jurisdictions that

2 See Electricity – National Scheme (Queensland) Act 1997 (Qld); National Electricity (New South Wales) Act 1997 (NSW); Electricity (National Scheme) Act 1997 (ACT); National Electricity (Victoria) Act 2005 (Vic); Electricity – National Scheme (Tasmania) Act 1999 (Tas); Australian Energy Market Act 2004 (Cth).

38

may otherwise occur, for example, as a result of delays in the legislative processes of the different States and Territories. On the other hand, the use of a lead legislature also means that both the implementation of the national framework initially, and the passage of any subsequent amendments, become susceptible to the whims of one jurisdiction's parliament and its electoral cycle.

182. It is nevertheless clear that this first option would ensure an agreed model for the regulation

of energy technical and safety issues is implemented and operates in a consistent manner in each State and Territory, thus meeting the objective of a harmonised national framework.

Option 2: Each State and Territory introduces their own legislation based on model legislation

183. The other option is for States and Territories to pass their own individual legislation in their own parliament which would be based on agreed model terms. This is the path the National OHS review is likely to adopt.

184. One example of this kind of model is the national scheme regulating offshore petroleum

safety. Under that scheme, the National Offshore Petroleum Safety Authority (NOPSA) is established under Commonwealth legislation – the Offshore Petroleum Act 2006 (the Commonwealth Act). NOPSA exercises various functions and powers in relation to the occupational health and safety of persons engaged in offshore petroleum operations. These functions and powers are conferred on it by or under the Commonwealth Act in relation to offshore petroleum operations in Commonwealth waters.3 The States and Northern Territory have enacted 'mirror' provisions which confer equivalent functions and powers within State and Northern Territory coastal waters.4 Accordingly, while each jurisdiction has enacted separate legislation under this scheme, the outcome is that NOPSA can effectively exercise uniform powers and functions in both Commonwealth and jurisdictional waters.

185. In the present case, it is likely that this option would reduce the regulatory burden by only

requiring one Act for both electricity and gas in each jurisdiction. It would also provide harmonisation with other jurisdictions to the extent that each State or Territory chooses to mirror the model legislation.

186. However, the Leaders Group is of the opinion that adopting this approach would only

partially achieve the objective of creating a harmonised regulatory framework. 187. As this option does not require jurisdictions to adopt and apply a 'template' Act, it may be

possible for a State or Territory to deviate from the agreed model terms to suit its own circumstances. Also, it should be noted that when amendments are required to be made to the framework, each jurisdiction would need to pass amending legislation in the same terms. A jurisdiction's refusal to amend in accordance with other jurisdictions, or a delay in doing so, would lead to inconsistencies between jurisdictional laws. This would result in a lack of uniformity in the application of the framework nationally.

188. The national reform of the law of defamation is an example of a national scheme based on

this model where differences do exist between jurisdictions. The common law of defamation applies in Australia, except to the extent modified by State or Territory legislation. Uniform defamation legislation came into force throughout Australia in 2006.5

3 See s 356 of the Commonwealth Act. 4 See, eg, s 151E of the Petroleum (Submerged Lands) Act 1982 (Qld). 5 See Civil Law (Wrongs) Act 2002 (ACT); Defamation Act 2005 (NSW); Defamation Act 2006 (NT);

Defamation Act 2005 (Qld); Defamation Act 2005 (SA); Defamation Act 2005 (Tas); Defamation Act 2005 (Vic); Defamation Act 2005 (WA).

39

However, as a result of some differences existing between these jurisdictional laws, the law of defamation varies slightly in each State and Territory.

189. It follows from the above that although implementing this second option would improve the

harmonisation of energy technical and safety regulation nationally, this would not be to the extent that could be provided by the first option above. There may also be other options for the design of the framework that would ensure a more consist approach is adopted nationally. For example, the relevant legislation could be passed solely by the Commonwealth Parliament. It is possible, however, that a referral of State power to the Commonwealth may be required for this purpose (see s 51 (xxxvii) of the Australian Constitution).

190. These and any other relevant options will be considered by the Leaders Group as it further

deliberates the question of the appropriate legislative architecture for the national scheme.

Stakeholder comments: The Leaders Group seeks comment on the options presented for legislative implementation.

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Next Steps 191. This discussion paper is a first step in developing the Harmonisation Implementation Plan

envisaged in the Terms of Reference of the Energy Technical and Safety Leaders Group. There are many issues related to implementation that need to be addressed before a comprehensive Harmonisation Plan is finalised and submitted for approval by MCE.

192. Many of these issues are alluded to in the current draft discussion paper and they include

the following: • development of a consultation Regulatory Impact Statement (RIS), including a

cost/benefit analysis, intended to be released for stakeholder consultation in conjunction with the Draft Implementation Plan;

• determination of the full scope of the existing State and Territory technical and safety legislation/regulations with the view to identify areas for harmonisation

• recommendations for the final scope of a national ENSS with addendums of State and Territory additional requirements;

• a protocol for the development of standards for the ENSS; • a first draft version of a standard for the ENSS; • a first version of the Scheme Rules; • a framework for the operation of the Advisory/Regulatory Committee including the

proposed National Register; • legislative mapping; and • EE-OZ assessment of the differing statutory competencies requirements.

Stakeholder comments: The Leaders Group seeks stakeholder feedback on the proposed subsequent documents required in addition to the Harmonisation Implementation Plan and suggestions on any other documents that may be required.

193. Absent from this discussion paper is a strategy for implementation of the proposed model.

The Leaders Group is seeking stakeholder feedback on how the proposed model could be implemented. This feedback will go towards developing a detailed strategy for implementation to be included in the Final Plan presented to MCE.

194. The Leaders Group has discussed the possibility that the proposed model may be

implemented in stages. Given that the gas industry is more advanced in terms of harmonisation than the electricity industry, the Leaders Group acknowledges that it may be advisable to have a staged approach to implementation. To begin with, a stage one approach could be to develop harmonised standards in the electricity industry equivalent to that of the gas industry and, at stage two, both industries could integrate under a harmonised national framework for energy safety and technical regulation inline with the terms of reference set out by the MCE and the National OHS Review.

Stakeholder comments: The Leaders Group seeks stakeholder feedback on how the proposed model should be implemented. What sequence should the model be implemented in and are there some aspects of the proposed model that need to be implemented before others?

195. Stakeholder comments are sought by Friday 3 April 2009. Stakeholders are asked to

consider this discussion paper in light of the National OHS Review's scoping paper released mid February 2009.

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196. Following stakeholder comments, the Leaders Group proposes to develop a Draft Harmonisation Implementation Plan for stakeholder comments in mid 2009. A consultation Regulatory Impact Statement will be released at the same time.

197. It is expected that a Final Harmonisation Implementation Plan will be presented to MCE at

the end of 2009/early 2010. The Final Harmonisation Implementation Plan will contain a detailed strategy for implementation of the recommended framework.

198. Should the MCE agree to the recommendations in the Final Harmonisation Implementation

Plan it is envisaged that the Leaders Group, or a similarly structured working group, will continue to develop and implement the recommendations.

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Appendix 1: Terms of Reference ENERGY TECHNICAL AND SAFETY LEADERS GROUP

HARMONISATION OF ENERGY TECHNICAL AND SAFETY REGULATION

Terms of Reference

Background In November 2007, the Commonwealth Government committed to work with State and Territory Governments and the energy sector to improve the consistency of state-based regulations – such as occupational health and safety requirements – that apply to the energy sector. As a first step in this process, on 14 April 2008 the Department of Resources, Energy and Tourism, on behalf of the Ministerial Council on Energy (MCE) Standing Committee of Officials (SCO), held a workshop with the energy sector and regulators. The purpose of the workshop was to discuss the extent of the technical and safety regulatory requirements that currently operate at a state/territory and national level, and the extent to which harmonisation has taken place. The workshop participants identified a number of areas of further work for advancing the harmonisation of technical and safety regulation. Participants also noted that the energy sector had been working to develop a harmonised approach to technical and safety regulation. In 1994, the Council of Australian Governments (COAG) endorsed Australian Standard AS 2885 Pipelines- Gas and Liquid Transmission as the basis for regulating gas transmission pipelines. This standard is still used by regulators. Australian Standards Committee AG-008 is now preparing similar performance based standards for the gas distribution industry. There are calls for similar standardisation for electricity networks. National standards for electricity transmission and distribution are at an early stage of development. Different technical and safety requirements apply to electricity generators in each jurisdiction. In April 2008, the Energy Network Association (ENA) released its policy for technical/safety regulation.6 This policy seeks increased national consistency of network technical/safety requirements. At its 13 June 2008 meeting, MCE recognised the importance of technical/safety regulation to ensure public safety, that workers operate within a safe environment and to enable the provision of safe and efficient energy services. MCE also noted that harmonisation of such regulation is also important to: • enable the efficient delivery of energy services; • lower the compliance burden for multi-jurisdictional operators; and • facilitate greater labour mobility and swifter emergency response, especially in the

context of skilled labour shortages. In recognising this, the MCE also approved Principles (See Appendix B.1) for the development of a harmonised approach to energy technical and safety regulation. Other relevant reviews At its 26 March 2008 meeting, COAG endorsed a far reaching reform agenda for reducing the costs of regulation and enhancing workforce mobility in areas of shared Commonwealth and

6 Energy Network Association, A policy for a national framework for energy safety in Australia, April 2008.

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State responsibility. COAG agreed to 27 areas of regulatory reform. This includes an inter-governmental agreement by May 2008 to harmonise occupational health and safety laws. COAG will consider the scope for a reduced implementation timetable at its meeting in July 2008. It is recognised that the work of COAG may input into the development of specific energy technical and safety regulations, and potentially cover some areas of the energy supply chain. Energy Technical and Safety Leaders Group Given the work of industry to date, SCO notes the energy sectors’ preference for a Working Group of industry, regulators and unions, to lead the development of an energy technical and safety regulation harmonisation enhancement plan. SCO therefore invites all sectors of the energy industry to participate in the Energy Technical and Safety Leaders Group to develop the energy technical and safety regulation harmonisation enhancement plan, consistent with the Principles contained in Appendix B.1, noting however the possible overlap with the work of the COAG review of general Occupational Health and Safety Laws. The Leaders Group is to comprise an Independent Chair appointed by SCO and representatives (or industry association acting on behalf of a segment of industry, or regulators) from the following sectors of the market; Electricity network owners and operators (from both transmission and distribution); Gas pipeline owners and operators or industry association (from both transmission and distribution); • Energy retailers or industry association; • Electricity generators or industry association; • Energy technical and safety regulators (from both gas and electricity); • Unions; and • Energy users.

The Leaders Group should consult, as necessary, with other MCE Working Groups to ensure areas of overlap between the work of the Leaders Group and other work streams are coordinated. Jurisdictional representation may be part of the Leaders Group. The Chair will report to the Chair of MCE SCO providing regular (bi-monthly) progress reports. The Commonwealth Department of Resources, Energy and Tourism will provide secretariat services for the Energy Technical and Safety Leaders Group and the Chair. If the Plan is not provided by the required date, then the MCE will consider the need for developing and mandating its own technical and safety regulation harmonisation enhancement plan. Scope of Work and Deliverables The Leaders Group is to develop an Energy Technical and Safety Regulation Harmonisation Enhancement Plan to be presented at the next MCE meeting. Specifically, the Plan should include, at a minimum, separate work plans for the development of a more harmonised approach to energy technical and safety regulation for the electricity network and generation sectors, as appropriate. In developing its plan, the Leaders Group should take account of the following: the MCE Principles in Appendix B.1; the new governance, institutional and legislative arrangements for the energy sector; and associated energy reform initiatives currently being undertaken by the MCE and the COAG Business Regulation and Competition Working Group reforms.

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Appendix B.1: MCE PRINCIPLES FOR DEVELOPMENT OF HARMONISATION OF TECHNICAL AND SAFETY REGULATION The Leaders Group should be guided by the following MCE Principles for developing an implementation plan and enhanced harmonisation of technical and safety regulation. • Technical and safety regulation is important for public safety and to ensure workers

operate within a safe environment and enable the provision of safe energy services, taking into account that energy supply industry assets reside in public places.

• Reducing the cost of regulation and the regulatory burden on business, particularly where regulation affects businesses that work across jurisdictional boundaries, without compromising safety outcomes.

• Enhancing productivity and workforce mobility - enable the delivery of efficient network services; lower the compliance burden for multi-jurisdictional operators; and facilitate greater labour mobility and swifter emergency response, especially in the context of skilled labour shortages.

• Regulatory certainty and consistency across all jurisdictions, to the extent appropriate. • Energy specific regulation should not duplicate or be inconsistent with general

Occupational Health and Safety legislation, and the Council of Australian Governments' (COAG) Business Regulation and Competition Working Group's reforms in the harmonisation of general Occupational Health and Safety laws and regulations. This should take into account that energy supply industry assets reside in public places.

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Appendix 2: Energy Technical and Safety Leaders Group

Member Sector/Industry Association

Peter Walsh Independent Chair Gary Towns Electricity Transmission (ENA) Michael Kilgariff Electricity Distribution (ENA) Ian Stewart Gas Distribution Pipelines (ENA) John van Weel Australian Industry Pipeline Association (APIA) Steve Brown National Generators Forum (NGF) Ken Bowron Electrical Regulatory Authorities Council (ERAC) Ken Gardner Gas Technical Regulators Committee (GTRC) Peter Tighe Communications, Electrical and Plumbing Union (CEPU) John Ingram Communications, Electrical and Plumbing Union (CEPU) Colin Heath Australian Workers Union (AWU) Bob Taylor ElectroComms and Energy Utilities Industry Skills Council

(ee-oz) James Tinslay National Electrical and Communications Association

Alternate Members Sector/Industry Association Harry Schaap National Generators Forum (NGF) Neville Betts Communications, Electrical and Plumbing Union (CEPU) Paul Grant Electrical Regulatory Authorities Council (ERAC) Albert Koenig Electrical Regulatory Authorities Council (ERAC) Ralph Mignone Gas Distribution Pipelines

Secretariat Sector/Industry Association Violette Mouchaileh Department of Resources, Energy and Tourism Lisa Gooding Department of Resources, Energy and Tourism

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Appendix 3: Use of Standards, Codes, Guidelines & Polices in Australian Legislation in relation to Energy Network Safety

USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN AUSTRALIAN LEGISLATION IN RELATION TO ENERGY NETWORK SAFETY

AUSTRALIAN CAPITAL TERRITORY ELECTRICITY AND GAS NETWORK (UTILITIES) LEGISLATION ACT PLANNING AND LAND AUTHORITY

THE UTILITIES ACT 2000 regulates the provision of utility services. The Authority administers part 5 of the Act, which deals with technical regulation obligations of utilities. The obligations, as set out in technical codes and in certain plans or rules established under those codes, relate to:

• the quality of the supplied services and the standards to which the networks are being constructed or maintained;

• the conditions for provision of new or resized connections and who is authorised to work on connections to the network;

• the preparedness for and handling of emergency situations; and

• a utility's meters. Management of Electricity Network Assets Code

The Code requires an operator to have a Safety Plan which:

• describes how the network operator will achieve compliance with the requirements of the Code

• incorporates a Code as a Schedule 1 to the Code. This schedule 1Code is a reprint of an earlier version of ENA’s NENS 01, National Electricity Network Safety Code

The ENA’s NENS 01, National Electricity Network Safety Code sets out minimum safety standards for the design, construction, operation and maintenance of electricity networks. The relevant documents (guides, codes and standards) referred to in the appendices to the Code should be considered for the design, construction, operation and maintenance of electricity networks and work practices.

Gas Safety and Operating Plan Code

The Code requires operators to develop and implement a Safety and Operating Plan which is to ensure the safe operation and maintenance of a Gas Network to which it relates and the gas quality standards and gas pressure standards

The safety and operating plan must contain a hazardous events analysis consistent with the applicable standards and codes

The Safety and Operating Plan must not be inconsistent with the relevant Australian Standards. The operator of a Gas Network must comply with the relevant Australian Standards but none are referenced.

OHS LEGISLATION ACT WORKCOVER

Occupational Health and Safety Act 1989

The Minister may approve a code of practice.

In summary an approved CODE OF PRACTICE

• Gives practical guidance on how the required standard of health and safety can be achieved in an area of work,

• Should be followed, unless there is an alternative course of action which achieves the same or better standard of health and safety in the workplace,

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USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN AUSTRALIAN LEGISLATION IN RELATION TO ENERGY NETWORK SAFETY

• Can be used in support of the preventive enforcement provisions of the Occupational Health and Safety Act,

• Can be used to support prosecution for failing to comply with or contravening the Act or Regulations.

Work Safety Act 2008 will repeal the OHS Act 1989 and commences on 1 July 2009. It retains the Minister’s ability to approve a code of practice

No energy network specific Codes found

NEW SOUTH WALES ELECTRICITY NETWORK LEGISLATION DEPT OF WATER & ENERGY

Electricity Supply (Safety and Network Management) Regulation 2008

A network operator must take into account notified codes, standards and guidelines and where notified documents are varied by the network operator, the network management plan must document the arrangements in place to ensure an equal or better outcome

The Director-General has notified the following documents:

• NENS 01, National Electricity Network Safety Code (modified)

• NSW Contestable Works Code

• NSW Service Standards Code

• NSW Installation Safety Management Code

• Service and Installation Rules Code

• NSW Maritime Crossings of NSW Navigable Waters: Electricity Industry Code (NSW Maritime)

• NSW Demand Management for Electricity Distributors Code

Electricity Supply Act 1995

The objects of this Act are:

(a) to establish a competitive retail market in electricity so as to promote efficient and environmentally responsible production and use of electricity and to deliver a safe and reliable supply of electricity, and

(b) to confer on network operators such powers as are necessary to enable them to construct, operate, repair and

GAS NETWORK LEGISLATION DEPT OF WATER & ENERGY

Gas Supply (Safety and Network Management) Regulation 2008

A network operator must develop and operate a safe gas network. The network is to be designed, constructed and operated in accordance with the appropriate requirements of the following standards:

• AS 1697: 2005, Installation/maintenance of steel pipe systems for gas

• AS 2885, Pipelines – Gas and liquid petroleum including

o AS 2885.1—2007

o AS 2885.2—2007

o AS 2885.3—2001

o AS/NZS 2885.5—2002

• AS 3723: 1989, Installation/maintenance of gas plastics pipe systems for gas

• AS 4041: 2006, Pressure piping.

• AS 4564: 2005, Specification for general purpose natural gas.

• AS 4645: 2005, Gas distribution network management

• AS/NZS 1596: 2008, The storage and handling of LP Gas .

OR

• Other standards identified in a safety and operating plan that are no less stringent than the above standards

PIPELINE LEGISLATION DEPT OF WATER & ENERGY

Pipelines Regulation 2005

A pipeline operator is to design, construct and operate a pipeline in accordance with:

• AS 2885.1: 2007, Pipelines-Gas and liquid petroleum-Design and construction,

• AS 2885.3: 2001, Pipelines-Gas and liquid petroleum-Operation and maintenance,

OR

• Another design standard approved for an individual licensee by the Director-General

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USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN AUSTRALIAN LEGISLATION IN RELATION TO ENERGY NETWORK SAFETY

maintain their electricity works, and

(c) to regulate network operations and electricity supply in the retail market in a manner that ensures open access to electricity distribution systems, promotes customer choice and creates customer rights in relation to electricity connections and electricity supply, and

(d) to promote and encourage the safety of persons and property in relation to the generation, transmission, distribution and use of electricity.

Gas Supply Act 1996

Applicable as it provides network operators with certain powers and duties relating to gas works (see Part 4 Gas Works)

OHS LEGISLATION WORKCOVER NSW

OHS Act 2000 and OHS Regulation 2001

STANDARDS that are part of NSW OHS laws are:

• AS/NZS 4360: 1999 - Risk Management

• AS/NZS 1269.0: 1998 - Occupational Noise Management

• AS/NZS 4804: 1997 - OHS Management Systems

INDUSTRY CODES OF PRACTICE made under the OHS Act 2000 is not law, but should be followed unless there is an alternative course of action that achieves the same or better standards. Evidence of failure to observe an industry code of practice may be used as evidence in proceedings. However, a person is not liable simply because of a failure to observe the code. The following codes under the OHS Act 2000 and OHS Regulation 2001 apply

• Low Voltage Electrical Work Code aims to protect electrical workers. IT DOES NOT APPLY TO ELECTRICITY NETWORK OPERATORS. AS/NZS 4836: Safe working on low voltage electrical installations also provides guidance but provisions relating to live work is inconsistent with the OHS Regulation.

• Work Near Overhead Power Lines: Code of Practice aims to PROTECT THE HEALTH AND SAFETY OF NON NETWORK WORKERS. This code draws on information contained in the Queensland and Victorian WorkSafe Codes plus ENA’s NENS 04-2003 National guide

NORTHERN TERRITORY ELECTRICITY NETWORK LEGISLATION NT WORKSAFE

Electricity Reform Act

The Electricity Reform Act and Electricity Reform (Safety and Technical) Regulations cover electricity network safety.

The provisions are similar to the NENS Code except that schedules to the regulation prescribe safety clearances for work, overhead lines etc

ENERGY PIPELINE LEGISLATION

ENERGY PIPELINES ACT - SECT 34 Construction to comply with prescribed standards

An energy pipeline shall be constructed in accordance with the prescribed standards, specifications and conditions and such other standards, specifications and conditions as are specified in the licence in respect of the pipeline.

ENERGY PIPELINES REGULATIONS - SECT 30 Description of standards

The pipeline management plan is to include a description of the Australian Standards and international standards applied, or that will

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USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN AUSTRALIAN LEGISLATION IN RELATION TO ENERGY NETWORK SAFETY

be applied, for the design, construction, operation, modification and decommissioning of the pipeline.

Meaning of validation

A validation of a proposal for a pipeline under these Regulations is a statement in writing by an independent validator that -

• the proposal is suitable for the purposes for which it is proposed;

• if the proposal includes a modification of the pipeline that may affect the integrity of the pipeline - there are reasonable grounds to believe that the modification will result in the pipeline being suitable for the purposes for which it is to be used;

• the proposal is consistent with the pipeline management system description in the pipeline management plan in force for the pipeline; and

• the proposal complies with any Australian Standards or international standards that are specified in the pipeline management plan as applying to that kind of proposal.

DANGEROUS GOODS ACT & REGULATIONS  

• Governs Network operations and gives rise to requirements that individuals performing work on network assets be licensed.

OHS LEGISLATION NT WORKSAFE

Workplace Health and Safety Act

NT WorkSafe is the administrative and regulatory arm of the Northern Territory Work Health Authority - the statutory body established under the Workplace Health and Safety Act.

NT WorkSafe is responsible for the Territory-wide regulation of occupational health and safety, dangerous goods, electrical safety, and rehabilitation and workers' compensation.

Workplace Health and Safety Act and Workplace Health and Safety Regulations

Approved codes of practice:

• provide guidance to persons with duties of care under the Workplace Health and Safety Act;

• are admissible as evidence in proceedings under the Workplace Health and Safety Act; and

• are not mandatory but must be followed unless health and safety is achieved in other more practicable ways.

QUEENSLAND ELECTRICITY NETWORK LEGISLATION DEPARTMENT OF EMPLOYMENT AND INDUSTRIAL RELATIONS

The Electrical Safety Act 2002

The Act and Electrical Safety Regulation 2002 set down among other things safety/technical requirements for the works of electrical entities which does reference standards and a number of ENA guidelines.

As an alternative it also establishes requirements for safety management plans

GAS NETWORK AND PIPELINE LEGISLATION DEPARTMENT OF MINES AND ENERGY

Petroleum and Gas (Production and Safety) Act 2004

Safety in the petroleum and gas (& pipeline) industries is dealt with by the Petroleum and Gas (Production and Safety) Act 2004 and Petroleum and Gas (Production and Safety) Regulation 2004.

The legislation covers naturally produced petroleum and natural gas, fuel gases such as LPG, CNG, LNG and related products, and sewage and other bio-gases. It does not cover acetylene,

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USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN AUSTRALIAN LEGISLATION IN RELATION TO ENERGY NETWORK SAFETY

The legislative framework for electrical safety also establishes standards for industry and the public through codes of practice.

A code of practice does not specify everything that should or should not be done to meet an electrical safety obligation. However, persons would fail to meet their obligations if they:

• went against or acted inconsistently with a code of practice, OR

• did not adopt a method as safe as, or safer than, the code

The Code of Practice for Working Near Exposed Live Parts applies to non network workers such as crane drivers

The Code of Practice for Works gives practical advice to electricity entities on ways of ensuring electricity networks are safe.

The Code of Practice Electrical Equipment - Rural Industry applies to people whose business or undertaking includes rural industry work.

ammonia, petrol, diesel and other 'refined gases or products'.

Industries covered by the legislation include petroleum exploration and production, petroleum pipelines, gas distribution (including reticulation and gas cylinders), automotive LPG, gas users (from power stations to pottery kilns) and licensing the installation and servicing of domestic, commercial and industrial gas devices.

Under the legislation and regulation, a number of activities require forms to be submitted to the department or certificates to be issued to owners and operators of gas systems.

Under the legislation, the pipeline Standard AS2885 is mandatory but all other pipeline and gas reticulation standards, codes and guides are listed as preferred where they are referenced in the legislation.

OHS LEGISLATION DEPARTMENT OF EMPLOYMENT AND INDUSTRIAL RELATIONS

Workplace Health and Safety Act 1995

The Act establishes a framework for preventing or minimising exposure to risk. Under the Act, there are three types of instruments to help persons meet workplace health and safety obligations – regulations, ministerial notices and codes of practice.

If a code of practice states a way of managing exposure to a risk, a person discharges the person’s workplace health and safety obligation for exposure to the risk only by -

• adopting and following a stated way that manages exposure to the risk; OR

• doing all of the following -

o adopt and follow another way that gives the same or greater level of protection against the risk;

o take reasonable precautions; and exercise proper diligence.

SOUTH AUSTRALIA ELECTRICITY NETWORK LEGISLATION THE TECHNICAL REGULATOR, DEPARTMENT OF TRANSPORT ENERGY AND INFRASTRUCTURE

The Electricity Act 1996 The Electricity Act 199, Electricity (General) Regulation 1997 and the Electricity (Principle of Vegetation Clearance) regulation 1996 are administered by the Technical Regulator.

The Regulations make extensive reference to National and International Standards, and industry Codes and guidelines (ENA

GAS NETWORK LEGISLATION THE TECHNICAL REGULATOR, DEPARTMENT OF TRANSPORT ENERGY AND INFRASTRUCTURE

Gas Act 1997

The Gas Act 1997 and Gas Regulations 1997 constitute the framework for network operators.

Reg 10 states that gas infrastructure must be designed, installed,

PIPELINE LEGISLATION NATURAL GAS AUTHORITY SA (NGASA), DEPARTMENT OF TRANSPORT ENERGY AND INFRASTRUCTURE

The Natural Gas Authority Act 1967

The NGASA was established on 30 June 1995 following the sale of the operational activities of the Pipelines Authority of South Australia and the sale of the Moomba to Adelaide pipeline.

The Natural Gas Authority Act 1967 forms the overarching legislative framework for NGASA's activities.

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USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN AUSTRALIAN LEGISLATION IN RELATION TO ENERGY NETWORK SAFETY

etc).

The regulatory processes and procedures encourage energy supply industries to be self-regulating while achieving industry best practice, as defined in various Australian and International Standards called up in the Regulations.

However, the regulations also provide for the development and implementation of safety, reliability, maintenance and technical management plans and reports. Electricity network operators must comply with approved management plans.

The Regulator may grant an exemption from the requirements, on terms and conditions the Technical Regulator considers appropriate.

operated and maintained to be safe ...so as to comply with any applicable requirements of AS 4645, AS 1596, AS 2885, AS 1697 and AS 3723 or achieve, ... , the same or better safety and technical outcomes.

The regulatory processes and procedures encourage energy supply industries to be self-regulating while achieving industry best practice, as defined in various Australian and International Standards called up in the Regulations.

However, the regulations also provide for the development and implementation of safety, reliability, maintenance and technical management plans and reports. Gas network operators must comply with approved management plans.

The Regulator may grant an exemption from the requirements.

Under section 6 of the Act, NGASA is constituted of the Minister for Mineral Resources Development who has delegated his functions to the Minister for Energy.

NGASA's primary function is to maintain title to 'pipeline land' for the purposes of the liquids pipeline from Moomba to Stony Point.

PETROLEUM ACT 2000

PETROLEUM REGULATIONS 2000

Pipelines in SA are regulated by the Department of Primary Industries and Resources (Petroleum Branch)

OHS LEGISLATION SAFEWORK SA, DEPARTMENT OF THE PREMIER AND CABINET

Occupational Health, Safety and Welfare Act 1986

The Occupational Health, Safety and Welfare Act and Regulations and Codes of Practice set out the OHS framework. An approved code of practice provides minimum standards of health and safety and is designed to be used in addition to the Act and regulations. In proceedings for an offence against the Act, where it is proved that a person failed to comply with a provision of a relevant, approved code of practice, the person shall be taken to have failed to exercise the required standard of care, in the absence of proof to the contrary.

Thus, a code of practice provides practical guidance on how a particular standard of health and safety can be achieved. It describes the preferred methods or courses of action for achieving the standard of health and safety. However, an approved code of practice allows the flexibility to show that an equivalent or better standard of health and safety is achieved by alternative action.

In summary, an approved code of practice:

• provides practical guidance;

• should be followed unless there is another solution which achieves the same or a better standard of health and safety;

• can be used to support prosecution.

TASMANIA ELECTRICITY NETWORK LEGISLATION WORKPLACE STANDARDS TASMANIA, DEPARTMENT OF JUSTICE

Electricity Industry Safety and Administration Act 1997

The Electricity Industry Safety and Administration Act 1997 and Regulations provide for electricity network safety management schemes.

Electrical safety management schemes are defined

GAS NETWORK LEGISLATION WORKPLACE STANDARDS TASMANIA, DEPARTMENT OF JUSTICE

Gas Act 2000

The Gas Act 2000 and Gas (Safety) Regulations 2002 provide for gas network safety management systems.

The safety management system for a facility must specify –

• all published technical standards applied to or used or to be

PIPELINE LEGISLATION WORKPLACE STANDARDS TASMANIA, DEPARTMENT OF JUSTICE

Gas Pipelines Act 2000

The Gas Pipelines Act 2000 and Gas Pipelines Regulations 2002 provide for safety and operating and safety management systems.

The main standards prescribed are:

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USE OF STANDARDS, CODES, GUIDELIN GISLATION IN RELATION TO ENERGY ES AND POLICIES IN AUSTRALIAN LENETWORK SAFETY

• An electrical safety management scheme is a scheme under which

(a) the manager of the scheme undertakes responsibility for ensuring compliance with standards applying under the Act, or standards the Regulator considers equal or superior to standards applying under the Act, in relation to electrical safety generally or a particular aspect of electrical safety by the participants in the scheme; and

(b) the participants in the scheme are exempted from compliance with the Act to an extent prescribed by the scheme.

• An electrical safety management scheme may provide that a certification, registration, licence or approval under the scheme is equivalent to a certification, registration, licence or approval under the Act or another law relating to electrical safety.

used in the design, construction, installation and operation of the facility; and

• the procedures to be implemented to ensure that the gas entity’s activities meet those standards.

The Gas standards to be used are prescribed.

AS 2885, Pipelines – Gas and liquid petroleum, as in force from time to time (including any code or standard having effect under that standard);

AS 4360, Risk management, as in force from time to time (including any code or standard having effect under that standard);

AS 4801, Occupational health and safety management systems – Specification with guidance for use, as in force from time to time (including any code or standard having effect under that standard);

Other standards for pipeline facilities are also prescribed.

OHS LEGISLATION WORKPLACE STANDARDS TASMANIA, DEPARTMENT OF JUSTICE

Workplace Health and Safety Act 1995

Workplace Standards Tasmania administers Workplace Health and Safety Act 1995 and regulations.

The Regulations are instructions given under the authority of the Act. The Act and Regulations go together to form the legal requirements that must be met

An approved Code of Practice is created under section 22 of the Workplace Health and Safety Act 1995. It documents an agreed means of achieving compliance and a Code should be followed, unless health and Safety can be achieved by other practicable means. A Code does not preclude innovation. Alternative systems of risk identification and control that deliver an equivalent or improved level of safety may be used.

VICTORIA ELECTRICITY NETWORK LEGISLATION ENERGY SAFE VICTORIA

Electricity Safety Act and various regulations which have extensive mandatory ESV Codes/guides, Australian Standards, ENA Guides etc

Electricity Safety (Management) Regulations 1999

Allows safety management schemes which provide the electricity industry with an alternative to complying with the relevant regulations under the Electricity Safety Act 1998. It was envisaged that this regulatory approach would encourage industry to improve the efficiency of its operation without

GAS NETWORK LEGISLATION ENERGY SAFE VICTORIA

Gas Safety Act 1997 and Gas Safety (Safety Case) Regulation 1999 provide for safety cases.

Safety management systems must specify all published technical standards applied to or used or to be used in the design, construction, installation and operation of the facility.

Published technical standards means a document which gives technical information, guidance or advice and that is published by-

• Standards Australia; or

PIPELINE LEGISLATION ENERGY SAFE VICTORIA

Pipelines Act 2005 and Pipelines Regulation 2007 provide for safety cases.

A pipeline Operator is to operate in accordance with:

• AS 2885.1, Pipelines-Gas and liquid petroleum-Design and construction,

• AS 2885.2-2002: Pipelines-Gas and liquid petroleum - Welding

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USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN RALIAN LE S AUST GI LATION IN RELATION TO ENERGY NETWORK SAFETY

compromising safety standards.

The objective of the ESMS was aimed at safety outcomes rather than prescriptively dictating how they should be achieved.

A company seeking to establish an electricity safety management scheme (ESMS) must demonstrate in detail to ESV how it proposes to meet or better the safety outcomes and objectives of the Electricity Safety Act 1998 and the relevant regulations through the operation and management of that scheme.

Amendments to the Electricity Safety Act, passed but not yet proclaimed, will require major electricity companies to submit Electricity Safety Management Schemes to Energy Safe Victoria. Requirements for an ESMS will include reference to published technical standards and submission of an Asset Management Plan. If ESV accepts an ESMS, the electricity company will be exempt from compliance with parts of Electricity Safety (Network Assets) Regulations. Compliance with an accepted ESMS is mandatory.

• The British Standards Institute; or

• The Australian Gas Association A.C.N. 004 206 044; or

• The International Organisation for Standardisation (ISO); or

• The Institution of Gas Engineers (United Kingdom); or

• Any similar standards organisation, whether within Australia or outside Australia.

• AS 2885.3, Pipelines-Gas and liquid petroleum-Operation and maintenance,

OHS LEGISLATION WORKSAFE VICTORIA

The Occupational Health and Safety Act 2004 sets out key principles, duties and rights in relation to occupational health and safety.

Regulations specify the way in which a duty imposed by the Act must be performed, or prescribe procedural or administrative matters to support the Act (e.g. requiring licences for specific activities, the keeping of records or giving notice).

Compliance Codes provide practical guidance to duty holders. If a person complies with a provision of a Compliance Code, they are deemed to comply with the duty in the Act or reg covered by the Code provision. However, Compliance Codes are not mandatory, and a duty holder may choose to use some other way to achieve compliance.

No energy network specific Codes found

WESTERN AUSTRALIA ELECTRICITY NETWORK LEGISLATION ENERGYSAFETY WESTERN AUSTRALIA

The Electricity Act 1945, the Electricity (Supply Standards and System Safety) Regulations 2001 and the Electricity Regulations 1947 apply.

Under Electricity (Supply Standards and System Safety) Regulations 2001 (which is administered by EnergySafety) the legislation provides for compliance to be either through a safety case or complying with prescribed standards and in the absence of a safety case compliance can

GAS NETWORK LEGISLATION ENERGYSAFETY WESTERN AUSTRALIA

The Gas Standards Act, 1972, the Gas Standards (Gas Supply and System Safety) Regulations, 2000.

Under Gas Standards (Gas Supply and System Safety) Regulations, 2000 the legislation provides for compliance to be either through a safety case or complying with prescribed standards and in the absence of a safety case compliance can be evidenced by

• an Australia jurisdictional standard or code

PIPELINE LEGISLATION DEPARTMENT OF INDUSTRY AND RESOURCES

Under the Petroleum Pipelines Act 1969, the Director Petroleum and Royalties Division of the Department of Industry and Resources (DoIR) is the statutory regulator for gas pipelines and is responsible for ensuring that risks associated with pipelines are managed in accordance with the owner’s licence.

The Department of Consumer and Employment Protection – Resource Safety Division provides regulatory and technical advice to DoIR.

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USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN GISLATION IN RELATION TO ENERGY AUSTRALIAN LENETWORK SAFETY

be evidenced by

• an Australia jurisdictional standard or code

• a standard or code published by Standards Australia, the Electricity Supply Association of Australia, or any other body or standard approved by the Director;

• a standard or code specified in the regulations

If a safety case has effect, the network operator must ensure activities are carried out to comply with practices/procedures set out in the safety case; and any provision of a code, standard or specification compliance with which is required under the safety case. Safety cases must be based on AG606 — 1997, Code of Practice for the Preparation of a Safety and Operating Plan for Gas Networks as there is not yet an equivalent electricity safety case standard

Please note that the regulations are in the process of being amended and a safety case will be mandatory for supply networks with more than 20,000 consumer sites. The safety case will need to comply with the relevant sections of AS4645 2009 Gas distribution networks until there is an equivalent electricity standard

• a standard or code published by Standards Australia, the Australian Gas Association, or any other body or standard approved by the Director;

• a standard or code specified in the regulations

If a safety case has effect, the network operator must ensure activities are carried out to comply with practices/procedures set out in the safety case; and any provision of a code, standard or specification compliance with which is required under the safety case. Safety cases must be based on AG606 — 1997, Code for Safety and Operating Plans for Gas Networks and AS 2885.1 —1997, Pipelines if that standard applies to the distribution system concerned

Please note that the regulations are in the process of being amended and a safety case will be mandatory for supply networks with more than 20,000 consumer sites. The safety case will need to comply with the relevant sections of AS4645 2009 Gas distribution networks

The pipeline owner is required to operate and maintain the pipeline consistent with the requirements of their pipeline licence, regulated by DoIR. This involves the assessment and management of risk consistent with the requirements of AS2885, which should establish that the level of risk should be low, negligible or as low as reasonably practicable, and that the level of individual fatality risk meets the relevant EPA criteria.

OHS LEGISLATION WORKSAFE WESTERN AUSTRALIA

The Occupational Safety and Health Act 1984 provides for occupational safety and health in Western Australia. It is supported by regulations, non-statutory codes of practice and guidance notes.

While many Australian Standards are referenced in the Act, none relate to Energy Networks

Regulations may prescribe minimum standards, have a general application or they may define specific requirements related to a particular hazard or a particular type of work.

A Code of Practice is defined in the Act as a practical guidance document on acceptable compliance with statutory requirements. Codes of practice should be followed, unless there is another solution which achieves the same or better result; and can be used to support prosecution for non-compliance. No energy network specific Codes found

AUSTRALIAN GOVERNMENT

OHS LEGISLATION Commonwealth

The Commonwealth Occupational Health and Safety Act 1991, supporting regulations and Code of Practice.

The Act defines the general duties and responsibilities of duty holders.

The Occupational Health and Safety (Safety Arrangements) Regulations 1991, and the Occupational Health and Safety (Safety Standards) Regulations 1994 set out mandatory obligations on specific matters. The regulations are written in terms of process and/or outcomes that duty holders must follow or achieve to meet their general duties under the Act.

The Act and regulations are supported by a Code of Practice. The Code is a source of practical guidance on safe work practices and risk management in relation to specific hazards and/or hazardous

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USE OF STANDARDS, CODES, GUIDELINES AND POLICIES IN AUSTRALIAN LEGISLATION IN RELATION TO ENERGY NETWORK SAFETY

activities.

The Code provides guidance to duty holders on standards of health and safety that must be achieved in the workplace.

The Code aims to ensure that adequate health and safety standards are implemented on specific OHS matters whilst allowing flexibility for a duty holder to incorporate new inventions and technological changes that are most appropriate for their workplace, provided they do not reduce health and safety standards.

The Code does not impose mandatory legal obligations. Duty holders must comply with the Code unless they identify another way of achieving the same or better safety standards than those prescribed in the Code.

National OHS Strategy 2002-2012

Under the National Occupational Health and Safety Commission Act 1985 the Commission may declare national standards and codes of practice relating to occupational health and safety matters.

The Australian Safety and Compensation Council (ASCC) leads and coordinates national efforts to prevent workplace deaths, injury and disease in Australia.

The National OHS Strategy 2002-2012, which was endorsed by the Workplace Relations Ministers’ Council on 24 May 2002, records a commitment by all Australian, State and Territory governments, the Australian Chamber of Commerce and Industry and the Australian Council of Trade Unions to share in the responsibility of ensuring Australia’s performance in work-related health and safety is continuously improved.

In line with the strategy, the ASCC declares national codes of practice under section 6 of the Australian Workplace Safety Standards ACT 2005. In common with other NOHSC documents, these national codes of practice are advisory instruments only, unless they are made mandatory by a law other than the National Occupational Health and Safety Commission Act or by an award or instrument made under such a law.

The application of a national code of practice in any particular State or Territory is the prerogative of that State or Territory.

The Australian Government and the ASCC expect, however, that national codes of practice will be adopted by all State and Territory governments.

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Appendix 4: Safety & Technical Issues with Current Regulatory Arrangements ELECTRICITY SAFETY ISSUE VIC NSW QLD ACT WA SA TAS

Network worker safety - live work risks

ESV has a guideline "Minimum Rules for Carrying Out High Voltage Live Line Work in Victoria" formulated in 2004 by the "Live Line Technical Committee' consisting of a broad range of experienced stakeholders.

NSW OH&S regulations exempt network operators from working live provisions when working under Network Management Plans (NMP). NMP must include asset management and safety management strategies & related codes, guides & standards.

The Electrical Safety Regulation 2002 governs the performance of high voltage live line work. The electrical safety Code of Practice Works provides practical advice on ways to discharge electrical safety obligations under the Act.

Electricity network regulations require all work to be carried out safely and mandates the use of NENS Guidelines for HV live line working

No specific live line requirements dealt with in legislation. Utility safety management as outlined in Safety Reliability, Maintenance and Technical Plan. (SRMTMP)

The Workplace Health & Safety Act 1995 and Occupational Licensing Act 2005 (soon to be enacted with Electrical Work regulations and codes of practice) covers this generally,

Network worker safety - other network risks

ESV has a code of practice "The Blue Book" which sets out practices for safe work practice. The Blue Book is reviewed by the Electrical Safety Committee consisting of a broad range of experienced stakeholders. Network operators have produced their own code (The Green Book) which is industry specific and based on "The Blue Book"

NMP addresses all network risks for workers including asset management and safety management strategies & related codes, guides & standards.

Other worker network risks are covered in the Queensland Codes of Practice Works and Working Near Exposed Live Parts

Electricity network regulations require Network Operators to manage and workers to carry out prescribed activities safely

SRMTMP addresses all network risks for workers including asset mangement and safety management strategies & related codes and guidelines

The Workplace Health & Safety Act 1995 and Occupational Licensing Act 2005 (soon to be enacted with Electrical Work regulations and codes of practice) covers this generally,

Network worker safety - general OH&S risks

Generally OH&S risks are addressed by WorkSafe Victoria

Left entirely to WorkCover Authority; with cooperation through an Industry Safety Steering Committee.

Specified electrical OHS Risks are addressed in Queensland Codes of Practice Works, Working Near Exposed Live Parts and Electrical Safety Risk Management. The Workplace Health and Safety Act 1995 applies to general OHS risks.

WorkSafe regulations cover general OH&S risks with specialist support for electrical incidents provided by EnergySafety

OHS&W regulation dealt with by safe Work SA with coordination with Office of the Technical Regulators

The Workplace Health & Safety Act 1995 covers this generally.

Worker competence - Licensing of electrical workers

No licensing required for electricity network workers. However, a valid Victorian Passport issued by Network Operator is required when performing line worker's duties on network assets.

No licensing required for electricity network workers; this is left to network operators under their NMPs (NSW ISSC Guideline also exists).

Licensing of lineworkers workers is required under the Electrical Safety Act 2002, with eligibility requirements detailed in the Electrical Safety Regulation 2002

Construction Occupations (Licensing) Act 2004

EnergySafety licenses electricians and electrical contractors but not line workers who are required by the Electricity network regulations to be competent

Line workers are licensed by the Office of Business and Consumer Affairs. Technical Regulator reviews and approves high voltage training courses.

Currently under the Electricity Industry Safety and Administration Act 1997 Line Workers and Cable Jointers are not licensed, however with the enactment of the Occupational Licensing Act 2005 (hopefully Novemeber 08) they will need to be licensed.

General public - direct network risks

Covered by ESV Regulations under the Electricity Safety Act and No Go Zone Rules administered by Worksafe and in compliance with the gas and electricity regulations.

NMP addresses all network risks for general public and non-network workers; including asset management and safety management strategies & related codes, guides & standards.

This is addressed in the Electrical Safety Act 2002 as ‘obligations of an entity’. Mandated entity Safety Management Systems also address public safety risks. The Electrical Safety Regulation 2002 also includes provision for public safety, specifically while live line work is in progress.

Electricity network regulations require Network operators to ensure public is protected

SRMTMP addresses network risks for general public and non network workers including asset mangement and safety management strategies & related codes and guidelines. Legislation specifies specific relating to safe working distances, clearance requirements, coordination requirements requiring notification of network operator, transport clearance issues, building clearance distances.

The Workplace Health & Safety Act 1995 and Occupational Licensing Act 2005 (soon to be enacted with Electrical Work regulations and codes of practice) covers this generally,

General public - awareness of risks

The Electricity Safety Act and the associated regulations requires network operator (1) to take reasonable precautions to prevent unauthorized access; (2) affix warning signs to certain assets; (3) install marker tape to identify underground cables; etc.

NMP must have section about warning the public of the hazards associated with electricity in relation to a network operator's transmission or distribution system

The Electrical Safety Regulation 2002 calls up national standard LLM 01 – 2006 Guidelines for Live Barehand Work, which include public safety risks. Mandated entity Safety Management Systems also address public safety risks.

EnergySafety promotes network safety issues to the general public.

Office of the Technical Regulator and Network Operator in accordance with SRMTMP promote network safety issues to trades and the general public.

Bushfire risks from networks

Electricity Safety Act and the associated regulations require persons with electrical networks to submit and follow a Bushfire Mitigation Plan covering maintenance, clearance plans etc for assets in declared bushfire. ESV audits the plans and the compliance

NMP must have section addressing risks of fire ignition by electricity lines and interruptions from vegetation

The Electrical Safety Regulation states that an electricity entity must ensure that trees and other vegetation are trimmed. This Regulation also provides that an electrical distribution entity may isolate powerlines from sources of electricity in an emergency or to prevent an emergency.

Director Energy Safety as allowed under Electricity regulations has issued a code for vegetation management in the vicinity of powerlines and electricity network regulations require assets to be properly maintained

Specific vegetation clearance regulation setting out requirement for network operator to keep vegetation clear from powerlines. SRMTMP sets out activities and coordination to minimise risk of fire start.

Although only advisory, generally covered in the Office of TheTasmanian Energy Regulators' - Distribution Powerline Vegetation Management Code of Practice.

Customer installations - interface with networks (Service & Installation Rules)

Service & Installation Rules developed by Victorian Electricity Supply Industry (VESI) exist but do not have regulatory authority

Covered by NSW Code (which allows some flexibility) and Rules developed with stakeholders and published on DWE web site (hard copies of Rules sold by NECA NSW through trade outlets).

Electricity Regulations 2006 provides for National Electricity Rules to be followed

Electricity: Utilities Act 2000 - ActewAGL Service & Installation Rules

WA Electrical Requirements published by EnergySafety under the electricity licencing regulations mandate the customer installation requirements

Called up in Electricity Act 1996 – reviewed by technical regulator. This document is prepared and published by the utility and contains a number of aspects that are not all specifically safety related. Deals with achieving uniformity of approach and equipment selection

Electricity Industry Safety and Administratiion Act 1997

57

Customer installations - safety inspections

Electricity Safety Act and the associated Electricity Safety Installation Regulations dictate a process requiring Certificates of Electrical Safety and inspections by registered inspectors for new and modified work on customer installations

Shared responsibilities - installation owners and licensed installers covered by consumer safety regulations; while NMP must include NWO inspection regime and procedures for directions to remedy faulty work and the disconnection of unsafe installations

The Electrical Safety Regulation 2002 covers requirements for an entity testing of electrical equipment. Provisions require that an entity must periodically inspect installations and must test to ensure the installation is electrically safe.

Network Operators are required to inspect customer installations under the electricity regulations

OTR undertake installation safety inspections

Electricity Industry Safety and Administratiion Act 1997

Connection & disconnection of installations for safety - obligations & powers

The distribution companies use the Electricity Safety Installation Regulations and Certificates of Electrical Safety as proof of customer compliance (see about) in conjunction with their Service & Installation Rules Covered by Electricity Supply (Safety &

Network Management) Regulation 2008

The Electrical Safety Regulation 2002 details requirements for initial connection to a source of electricity as well as reconnection by an entity. An entity is required to examine or test an installation prior to connection or reconnection.

The Electricity Act requires Network Operators to be satisfied that an installation is safe before connecting it

Shared responsibility, network operator required to only conect an installation if it safe however can rely on a certificate of compliance issue by an electrical contractor as assurance of the safety of the installation. Network operator and OTR can disconnect power if installation is not safe.

Electricity Supply Industry Act 1995 and also Electricity Industry Safety and Administratiion Act 1997.

Embedded generators - interface with networks

Electricity Safety Act and the associated ESV Regulations and ESC Guidelines. Is under review to handle the smaller less knowledgeable generators

NEM framework + covered by connection contracts with NWO's & NSW Service & Installation Rules published on DWE web site (hard copies of Rules sold by NECA NSW through trade outlets).

Electricity Regulation 2006 (administered by the Department of Mines and Energy) section 28, customer cannot interconnect generating plant with a supplier's supply network without the supplier's agreement - agreement must include conditions for securing s

Each Network Operator must publish technical rules governing the requirements for the connection of generators including embedded generators

SRMTMP deals with safety issues. Installation rules set out safety and technical issues, distribution code deals with rule associated with responsibilities of parties involved.

Electricity Supply Industry Act 1995 and also Tasmanian Electricity Code.

Safety performance reporting - issues & trends (incl. Public availability)

ESV & ESC both monitor. ESV's focus is on safety ESC focus is more network reliability of which safety is a factor

Network operators required to publish annual performance reports

Serious Electrical Incidents and Dangerous Electrical Events need to be reported to the Electrical Safety Office under the Electrical Safety Act 2002.

EnergySafety provides safety performance statistics and reports which are readily available to the general public.

Regulations set out performance reporting requirements for network operators. Essentially this is against the SRMTMP.

Electricity Supply Industry Act 1995 and Tasmania Electricity Code (mandated in EIS&A).

Incident notification & investigation

Electricity Safety Act and the associated regulations require any serious electrical incidents to be reported to ESV Mandatory notification of serious accidents;

framework under NMP regulations for most incidents.

The Electrical Safety Act 2002 requires the distribution entity to advise of any serious or dangerous electrical incident. The mandatory entity SMS details how the electricity entity is to manage the hazards and risks to ensure the proper discharge of its electrical safety obligation.

Utilities Act 2000 Electricity Safety Act 1971 Gas Safety Act 2000

Electricity network regulations require Network Operators to report and investigate safety incidents and allow EnergySafety to investigate or follow up any report

Shock reports and incident notification legally required to be lodged with the Technical Regulator. The Technical Regulator examines this data for any follow up activity.

Electricity Industry Safety and Administratiion Act 1997.

Development & calling up of safety codes, guides & standards

ESV regulations generally cover areas that are not covered by standards or need to be mandated. The regulation permit subject to the use of approval electricity safety management schemes an exemption where the applicant can demonstrate that safety can be maintained by the application of standard or other industry practices

Prefer national approach (SA or ENA); NSW ISSC also publishes interim NSW documents where necessary (also WorkCover NSW).

Electrical Safety Act 2002 provides for the discharge of the electrical safety obligation through instruments – ministerial notice and codes of practice. Electrical Safety Regulation 2002 sets down requirements in relation to calling up standards and other guidance documents.

Electricity network regulations call up a large range of standards and codes and EnergySafety develops specific guides e.g. vegetation management near powerlines

OTR administer technical and safety aspects of the legislation including the calling up of codes or standards. Preference is given to national Standards

Generally under the Workplace Health & Safety Act 1995.

Compliance with safety framework

Where a safety management scheme or other safety framework exists ESV will Inspect and audit using internal or external resources as is appropriate

DWE now emphasises 3rd party certification, while taking issues based actions where warranted.

Electrical Safety Act 2002 establishes an obligation to ensure that an entity's works are maintained and operated in a way that is electrically safe. It is also a requirement that a prescribed electricity entity must give effect to, a safety management system for the entity. Electrical Safety Regulation 2002 prescribes the requirements for the system, content, reporting, review and auditing of the safety management system.

Electricity network regulations contain an option for Network Operators to develop a Safety Case in lieu of prescriptive requirements

Generally under the Workplace Health & Safety Act 1995 and Electricity Industry Safety and Administratiion Act 1997.

Vegetation Management

Electricity Safety Act and the associated Line Clearance Regulations & the Bush fire Mitigation regulations determine the responsibilities of the stakeholders including councils distribution businesses and road authorities etc in the management of vegetation. ESV is responsible for approvals and audit to ensure compliance to regulation

Electricity Supply Act re responsibilities; Network Management Plans cover safety, clearances & vegetation management.

Electrical Safety Regulations 2002 require that the person in control of an overhead electric line must ensure that trees and other vegetation are trimmed and entities vegetation management plans are regularly audited

Electricity: Utility Networks (Public Safety) Regulation 2001

Director of Energy Safety has published a code for vegetation management in the vicinity of powerlines which is mandated under Electricity regulations

Specific provisions called up by Electricity Act 1996. Specific principle of vegetation clearance regulation called up by the act. Act and regulation administered by the Technical Regulator.

Requirement of the Chapter 8A of the Tasmanian Electricity Code which is mandated under the Electicity Supply Industry Act 1995. OTTER also has a code of practice for Vegetation Management, but these only cover the standard of vegetation control, not the safe work practice required which are covered by OH&S etc.

Powers of safety regulators

ESV has powers to order the disconnection of supply, to issue directives to cease the use a particular equipment, to cease a work practices and to prosecute for breached of the acts and regulations. It can issue improvement notice to an approved Electricity Safety Management Scheme and audit, investigate accidents, or require documentations, etc..

DWE has powers to notify standards, direct amendment of NMP, initiate audit, investigate accidents, require reports

The Electrical Safety Act 2002 provides the power to impose obligations on persons, establish benchmarks, make regulations, ministerial notices and codes of practice, introduce safety management systems, provide for the safety of all persons through the licensing and discipline of persons who perform electrical work.

EnergySafety has powers of entry, inspection, request for information and can make binding orders for modifying or ceasing activities if considered unsafe

Covered by Electricity Supply Industry Act 1995 and also Electricity Industry Safety and Administration Act 1997 through delegation of powers.

58

TECHNICAL ISSUE VIC NSW QLD ACT WA SA TAS

Metering - Metrology, obligations, types, installers, load profiles etc

This fall into the jurisdiction of Vencor, NEMCO& Consumer Affairs

NEM framework + National Measurement Institute, relevant Australian Standards, National Electricity Market Management Company (NEMMCo) and NSW metrology procedures. Current NSW Electricity Market Operations Rule No. 3 is to be reviewed with the view to limiting its coverage to non-NEM metering.

NEM Framework plus Electricity Regulation 2006 (administered by Dept of Mines and Energy), sections 38 to 46 (Metering and Control Apparatus)

Electricity: Electricity Metering Code 2003

Economic Regulation Authority not safety regulator

Metering Code established by local economic regulator - ESCOSA

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Network Security

ESC thought the Electricity Industry Act, in conjunction with VENCorp & NEMMCO are responsible. ESV would become involved if it affects community safety

NEM framework for network security (NEL, NER, NEMMCO for load shedding procedures, Jurisdictional System Security Coordinators for Guidelines)

NEM framework for network security (NEL, NER, NEMMCO for load shedding.

Electricity: Utilities Act 2000 – Electricity Distribution (Supply Standards) Code

Economic Regulation Authority not safety regulator

The “Safety Case” plan adopted in SA is required by legislation, and is recommended for approval by the Technical Regulator. The Technical Regulator deals with technical (equipment) factors that drive security and reliability of supply. There is considered to be a synergy in the investigation of equipment failures in terms of safety outcomes and these same failures in terms of the impact on security of supply.

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Network Planning & Performance Standards - Transmission

Covered by VENCorp, Essential Services Commission & NEMMCO

Expected to be covered by new MCE/AEMC framework separating standards setting from planning and retaining jurisdictional roles - need to ensure harmonisation.

Electricity Act 1994 (administered by DME), section 34 imposes high level obligation on transmission entity. Transmission Authority issued by Regulator under Electricity Act 1994 (DME) requires specific reliability standards to be met.

Economic Regulation Authority not safety regulator

National arrangements and SA legislation also established an Electricity Supply Industry Planning Council (ESIPC). OTR role revolves around asset maintenance plans as called up in SRMTMP

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Network Planning & Performance Standards - Distribution

Covered by VENCorp, Essential Services Commission & NEMMCO

Network planning for levels of redundancy vs load groups are included in mandatory Reliability Licence Conditions. Security of facilities is covered in Network Management Plans. NSW Police work closely with electricity sector at a local and state level on security issues specific to the businesses.

Electricity Act 1994 (administered by DME), section 42(b) imposes high level obligation on distribution entity. Electricity Industry Code (administered by Qld Competition Authority) requires annual Network Management Plans and Summer Preparedness Plans.

Economic Regulation Authority not safety regulator

National arrangements and SA legislation also established an Electricity Supply Industry Planning Council (ESIPC). OTR role revolves around asset maintenance plans as called up in SRMTMP

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Other asset management Covered by NMP framework (asset

management strategies etc)

Not clear as to what this refers to - may be covered by Network Management Plans under Electricity Industry Code.

Economic Regulation Authority not safety regulator

OTR role revolves around asset maintenance plans as called up in SRMTMP

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Supply Quality Standards eg 240v

ESC & Regulations call up Australian Standards

Not specifically regulated; but each electricity distributor publishes the steady state voltage limits they are able to provide to customers (required to be part of the Network Management Plans).

Electricity Regulations 2006 (administered by the Department of Mines and Energy) section 11 specifies standard voltages for supply at low voltage ( 240V) and section 12 deals with supply at high voltage (agreed voltage).

Electricity: Utilities Act 2000 – Electricity Distribution (Supply Standards) Code

Economic Regulation Authority not safety regulator

Voltage standard called up by Electricity Act 1996. Quality of supply (harmonics, ripple ect) also called up by the legislation.

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Emergency Planning & Management

Emergency Management Act, Electricity Industry Act, Victorian Electricity Emergency Committee, VENCorp & NEMMCO

Covered generally by Network Management Plans, including testing and proving of emergency procedures. All D/TNSP are members of Energy and Utilities Functional Area (EUSFA), a sub group of the State Emergency Management Committee.

Electricity Act 1994 (administered by the Department of Mines and Energy) section 124, emergency rationing of electricity (i.e. imposing mandatory restrictions in supply shortfalls) [ Electrical Safety Regulations 2002 (administered by the Electrical Safety Office) part 9 Safety Management Systems for prescribed entities and Schedule 6, Prescribed electrical entities - presumably this is referring to safety emergencies?]

Emergencies Act 2004

Office Of Energy (WA Govt policy unit)

Technical Regulator is a member of the State emergency management committee. Technical Regulator liaises with energy industry representatives during the course of an emergency, interpreting and feeding relevant information into the State emergency operations centre. Technical Regulator involved in energy rationing events where an energy shortage is beyond the ability of the market to manage.

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Load shedding & load priorities

Victorian Electricity Emergency Committee, VENCorp & NEMMCO NEL: Jurisdictional System Security

Coordinators advise NEMMCO of guidelines; NEMMCO develops procedures

NEM framework - under NEL, NEMMCO has overall responsibility with Jurisdictional System Security Coordinators advising NEMMCO of jurisdictional load shedding priorities/guidelines.

Office Of Energy (WA Govt policy unit)

NEL Jurisdictional System Security Coordinator advice AEMC of state specific requirements

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Network (non-safety) performance reporting - issues & trends (incl. Public availability)

This is the domain of the economic regulars ESC / AER

Network operators required to publish annual performance reports

Quarterly reporting of performance against Minimum Service Standards and Guaranteed Service Levels under Electricity Industry Code (administered by Qld Competition Authority)

Economic Regulation Authority not safety regulator

Network Operators required to provide annual performance report

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

Major supply interruption reporting

The reporting of the supply interruptions is the domain of the economic regulars ESC / AER. If there is an electrical incident behind the interruption then the incident is reported to ESV

Implemented as part of reporting under NMP framework

Transmission and Distribution entities (GOCs) submit daily outage reports to Department of Mines and Energy under an agreed arrangement.

Economic Regulation Authority not safety regulator

Part of reporting requirements specified by legislation. Also reporting against KPI's included in SRMTMP

Electricity Supply Industry Act 1995, Tasmanian Electricity Code, NEL, NER and NEM.

59

GAS STATE ISSUE

VIC NSW QLD ACT WA SA

1. Metering Accuracy

Covered by VENCorp - Victorian Gas Industry Market and System Operations Rules for meter installations at systems points (transmission) and Gas Distribution System Code for metering installations at distribution delivery points.

Covered by National Measurement Act 1960 and NSW Gas Supply (Gas Meters) Regulation 2002. Australian Standard AS4670 – Domestic diaphragm gas meters (up to 12m3 (air) under development and due for release within approx 6 months.

Petroleum and Gas Measurement falls under Department of Mines and Energy DME)

Gas: General Gas Metering Code 2000

Gas: EnergySafety

Metering Code established by local economic regulator - ESCOSA. Technical Regulator reviews and audits gas meter replacement program including approval of life extensions.

2. Service and installation rules

Gas Safety Act 1997 and Gas Safety (Gas Installation) Regulations 1999

Covered by NSW Gas Supply (Safety and Network Management) Regulation 2008, which calls up Australian Standards AS4564 – Gas Distribution, AS5601 – Gas Installations and Network Operators own gasfitting rules.

For gas networks - Safety management plan and standards requirements under Petroleum and Gas (Production and Safety) Act 2004 (DME)

Gas: Utilities Act 2000 - Gas Network Boundary Code 2000

Gas: EnergySafety This document is prepared and published by the utility and contains a number of aspects that are not safety related

3. Vegetation Management

Gas Safety Act 1997 & Gas Safety (Safety Case) Regulations 1999. Gas Pipeline and Distribution companies also have Environmental Management Plans.

Covered by network operators under their Safety and Operating Plans. Environmental Management Plans are commonly required for licensed transmission pipelines as a licence condition.

Environmental Protection Agency EPA

Gas: Utility Networks (Public Safety) Regulation 2001

Gas: EnergySafety (above ground) N/A

4. Supply Standards eg 240v

Gas Safety Act 1997 & Gas Safety (Gas Quality) Regulations 2007. Also VENCorp Gas Quality Guideline and Specification for system injection points.

NSW legislation calls up Australian Standards AS4564 – Specification for natural gas and AS4670 – Commercial propane/butane for heating.

Australian standards called up under Petroleum and Gas (Production and Safety) Act 2004 (DME)

Gas: Utilities Act 2000 – Gas Safety & operating Plan Code 2000

Gas: EnergySafety Gas quality standards are called up in the Gas Act 1997. These provisions are administered by the Technical Regulator

5. Incident notification

Gas Safety Act 1997 and Gas Safety (Safety Case) Regulations 1999 sections 12, 25 & 31

Covered by NSW legislation and DWE Reporting templates. For Gas requirements under Petroleum

and Gas (Production and Safety) Act 2004 (DME)

Utilities Act 2000 Electricity Safety Act 1971 Gas Safety Act 2000

Gas: EnergySafety

Incident notification legally required to be lodged with the Technical Regulator. The Technical Regulator examines this data for any follow up activity.

6. Licensing of electrical workers NA - Gas

No licensing required for gas network workers; this is left to network operators under their Safety and Operating Plans and OH&S obligations.

For Gas licensing requirements under Petroleum and Gas (Production and Safety) Act 2004 (DME)

Construction Occupations (Licensing) Act 2004 Gas: EnergySafety Gas fitters are liciensed by Office of Business

and Consumer Affairs.

7. Emergency Management

Gas Safety Act 1997 & Gas Safety Case Regulations 1999 section 21. Also covered by the State Emergency Response Manual???

Covered by Network Operators Safety and Operating Plans, which include testing and auditing of emergency procedures. NSW EUSFAC, NGERAC and NSW Natural Gas Supply Disruption Response Plan are in place to deal with major supply issues.

For gas – Safety management plan requirements under Petroleum and Gas (Production and Safety) Act 2004 (DME)

Emergencies Act 2004 Gas: Office of Energy

Technical Regulator is a member of the State emergency management committee. Technical Regulator liaises with energy industry representatives during the course of an emergency, interpreting and feeding relevant information into the State emergency operations centre. Technical Regulator involved in energy rationing events where an energy shortage is beyond the ability of the market to manage.

8. Security of supply

Gas Safety Act 1997 & Gas Safety Case Regulations 1999

Network planning for levels of redundancy vs load groups under own Safety and Operating Plans. NSW Police work closely with the gas sector at local levels on security issues specific to the businesses.

Gas Supply Act (DME)

Electricity: Utilities Act 2000 – Electricity Distribution (Supply Standards) Code

Gas: EnergySafety / Economic Regulation Authority

The “Safety Case” approach adopted in SA is called a Safety, Reliability, Maintenance and Technical Management Plan (SRMTMP). This plan is required by legislation, and is recommended for approval by the Technical Regulator. The Technical Regulator deals with technical (equipment) factors that drive security and reliability of supply. There is considered to be a synergy in the investigation of equipment failures in terms of safety outcomes and these same failures in terms of the impact on security of supply.

9. LPG - Autogas Mobile (eg caravans) Fixed non-network

Gas Safety Act 1997 & Gas Safety (Safety Case) Regulations 1999. Note ESV is not responsible for Autogas, mobile, road vehicles or marine.

EnergySafety

60

List of Acronyms

ACCC Australian Competition and Consumer Commission

AEMC Australian Energy Market Commission

AEMO Australian Energy Market Operator

AER Australian Energy Regulator

ALARP As Low As Reasonably Practicable

APEC/SCSC The Standards and Conformance Subcommittee of the Asian Pacific Economic Cooperation

AS Australian Standard

ASCC Australian Safety and Compensation Council

CaSServ Conformance and Standards Services

COAG The Council of Australian Governments

DEEWR Department of Education, Employment and Workplace Relations

EE-OZ ElectroComms and Energy Utilities Industry Skills Council

ENA Electricity Networks Association

ENSS Energy Network Safety System

ERAC Electrical Regulatory Authorities Council

ESI Energy supply industry

GRP Good Regulatory Practice

ISO International Organization for Standardization

JAS-ANZ Joint Accreditation System of Australia and New Zealand

MCE Ministerial Council on Energy

NEL National Electricity Law

NEM National Electricity Market

NEMMCO National Electricity Market Management Company

NGL National Gas Law

NOPSA National Offshore Petroleum Safety Authority

NSP Network Service Provider

OECD Organization for Economic Co-operation and Development

OHS Occupational Health and Safety

SCO Ministerial Council on Energy Standing Committee of Officials

TNSP Transmission Network Service Provider

WTO World Trade Organisation