Northern Territory Power and Water Corporation and Renewable Ener Gy Regulator
[2003] AATA 650
•10 July 2003
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2003] AATA 650
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q2002/877
GENERAL ADMINISTRATIVE DIVISION ) Re NORTHERN TERRITORY POWER AND WATER CORPORATION Applicant
And
RENEWABLE ENERGY REGULATOR
Respondent
DECISION
Tribunal Deputy President Don Muller Date10 July 2003
PlaceBrisbane
Decision The Tribunal has no jurisdiction to review this application.
...............SIGNED................................
D.W. MULLER
DEPUTY PRESIDENT
CATCHWORDS
Practice and Procedure – jurisdiction –whether renewable energy certificates were created - whether deleting out of date entries in Internet database a reviewable decision-
Renewable Energy (Electricity) Act 2000 sections 24,26 and 66
Renewable Energy (Electricity) Regulations clause 19 (3)
Administrative Appeals Tribunal Act 1975 section 25
REASONS FOR DECISION
Deputy President, Don Muller 1.This is an application by the Northern Territory Power and Water Corporation, formerly the Northern Territory Power and Water Authority, known as PowerWater, for review of a situation where the computer program of the Office of the Renewable Energy Regulator (ORER) automatically deleted entries from its Internet database for potential Renewable Energy Certificates (RECs), 12 months after they were entered by PowerWater on 1 April 2001.
2.The first issue to be considered by the Tribunal is whether the Tribunal has jurisdiction to hear this matter. The Respondent submits that there is no reviewable decision. The Applicant on the other hand submits that the Regulator made a decision in the exercise of its powers under the Renewable Energy (Electricity) Act 2000 (“the Act”), when it deleted the Applicant’s entries from its Internet database.
3.At the hearing the Applicant was represented by an employee, Mr Ian Hemming and the Respondent was represented by Ms Virginia Masters, from the Australian Government Solicitors.
4.The facts are not in dispute by the parties. The background legislation and facts are as follows.
5.The object of the Act is to require companies making wholesale purchases of electricity to demonstrate that they are purchasing increasing amounts of renewable energy. The companies thereby demonstrate that they are making a contribution towards achieving the Commonwealth’s mandatory renewable energy target.
6.This case specifically relates to renewable energy associated with solar water heaters (SWHs) for domestic use.
7.A householder who purchases a SWH for domestic use has a right to obtain Renewable Energy Certificates (RECs). One REC is the equivalent of one megawatt hour of displaced electricity (s.22 of the Act). A SWH which has a hot water output over ten years, is equivalent to that which would have been produced using 25 megawatt hours of electricity, can qualify for 25 RECs.
8.A REC is a tradeable commodity. Acquiring RECs enables liable parties such as PowerWater to meet their REC liability. The Act allows the owner of a SWH to assign their rights to create RECs to another party (s.23(2) of the Act). Thus a householder who purchases a SWH for domestic use may assign their RECs rights to another party (in this case Power Water), usually in exchange for some financial benefit to the householder. ORER calls parties such as PowerWater “agents” for the purpose of administration of the REC scheme. This arrangement allows agents to collect RECs rights and create the RECs in their own names. In this way PowerWater acquires RECs to offset their liability under the Act.
9.Any person creating a REC must be registered (s.23(3) of the Act). ORER registers agents upon submission of the appropriate information and payment of the fee specified in the Regulations. On 11 October 2001, the Respondent advised PowerWater that its application for registration to become an agent to create RECs had been accepted.
10.RECs can only be created within 12 months of installing a SWH (reg.19(3)). Creating a REC contrary to the “12 month rule” is an offence (s.24 of the Act, read with the Criminal Code). The Respondent does not have a discretion to register RECs in respect of SWH installations where the RECs are sought more than twelve months after the installation date.
11.The creation of RECs is a two-step process, performed by the agent. The registration of RECs is a further process, performed by the Respondent.
12.The RECs are only created in an electronic form through an Internet database registry, called the REC-Registry, pursuant to section 25 of the Act:
“s25 Form and content of certificates
(1)Certificates are to be created in an electronic form approved in writing by the Regulator.
(2) Each certificate is to contain:
(a) a unique identification code; and
(b)the electronic signature of the person who created the certificate; and
(c)the date on which the electricity in relation to which the certificate was created was generated; and
(d) the date on which the certificate was created.
(3)A certificate’s unique identification code is to consist of the following in the following order:
(a) the registered person’s registration number;
(b) the power station’s identification code;
(c) the year;
(d)a number in an unbroken sequence, that is used for all certificates issued in respect of electricity generated by the power station in that year, that starts at one and has increments of one.”
13.The Certificates are not valid until they have been registered by the Regulator pursuant to section 26 of the Act which states:
“26 Certificates must be registered
(1) A certificate is not valid until it has been registered by the Regulator.
(2)The Regulator must be advised of the creation of a certificate by electronic transmission in the manner determined, in writing, by the Regulator.
(3)When the Regulator is notified that a certificate has been created, the Regulator must determine whether the certificate is eligible for registration.
(3A)A certificate is not eligible for registration unless the Regulator has been paid the fee (if any) prescribed by the regulations for the registration of the certificate.
(4)If the Regulator determines that a certificate is eligible for registration, the Regulator must create an entry for the certificate in the register of renewable energy certificates and record the person who created the certificate as the owner of the certificate.
(5)If the Regulator determines that a certificate is not eligible for registration, the Regulator must notify the person who created the certificate.
(6)The Regulator may at any time (whether before or after the registration of a certificate) require the person who created the certificate to provide to the Regulator a written statement containing such information as the Regulator requires in connection with the creation of the certificate. The person who created the certificate must provide the statement within the period (not being a period of less than 14 days) specified by the Regulator.”
14.The REC-Registry requires the agent, in this case PowerWater, to enter certain installation information on the solar water heaters. Once this is completed the REC-Registry issues a “Deemed Output” with registration number and an option is given by the REC-Registry to either “create certificates now or use creation menu at a later date”.
15.The first step does not create a REC, or request its registration. The agent is then asked if it would like to take the second step and create the RECs immediately. If not, the agent can return to the REC-Registry at a later date to create the RECs. The “First step” records of installed SWHs are lodged in a private area in the REC-Registry called “maintain solar water heaters” until the RECs are created.
16.Some agents choose not to immediately take the second step and create RECs after entering or uploading SWH installation details. This may be a matter of administrative convenience for the agent. Another reason for delaying the creation of a REC is that once created, the existence and ownership of RECs becomes public knowledge via the REC-Registry. Agents may gain market advantage by withholding information about the number of RECs at their disposal from their competitors.
17.An agent who has not created RECs immediately after entering the installation details in the Registry must return to the private “maintain” area of the REC-Registry to continue the process through to actually creating a REC in the REC-Registry. It is only after this second step has been completed that an agent has created a REC.
18.Only once an agent has undertaken the second step of creating RECs in the REC-Registry is the Respondent able to consider whether or not the REC is valid and should be registered, in accordance with section 26 of the Act. It is only after the second “creation” step that a pending REC will appear in the “audit” area of the REC-Registry, which is routinely accessed by ORER staff.
19.The internet REC-Registry has been programmed to support the Act and the Regulations. This reduces the administrative burden of checking for valid applications and minimises the risk that agents will inadvertently commit the strict liability offence of creating invalid RECs. For example, if records in the “maintain” area are not fully activated by creating RECs, then 12 months after the SWH installation date the REC-Registry system will automatically remove those records from the “maintain” screen. This ensures that it is not possible to attempt to create a REC contrary to the twelve month rule and risk committing a strict liability offence.
20.In this case, PowerWater entered information relating to a number of SWHs, on 1 April 2001, but did not subsequently return to the private “maintain” area of the REC-Registry, to continue the process through to actually creating a REC in the REC-Registry, within the requisite 12 months. PowerWater opted for a later certificate creation date. The records of solar water heaters entered by the Applicant were kept in an area of the REC-Registry called the “Maintain Solar Water Heaters”. The Applicant was to access these entries at a later date and register them with the Regulator.
21.
If the Applicant had opted for “create certificates now”, the pending certificates would have appeared in the audit section of the REC-
Registry. This is where the Regulator’s staff could access the proposed certificates and decide, pursuant to section 26 of the Act, whether the Certificates were valid and should be registered.
22.The Respondent e-mailed PowerWater on 27 March 2002 warning that the 1 April 2001 entries in the “Maintain Solar Water Heaters” section of the REC-Registry were about to expire and the 12 month deadline for the entries would come into effect.
23.Unfortunately PowerWater did not access and register the entries in the “Maintain Solar Water Heaters” section of the REC-Registry before the 12-month deadline imposed by clause 19 (3) of the Renewable Energy (Electricity) Regulations.
24.PowerWater’s entries in the “Maintain Solar Water Heaters” section were deleted from the REC-Registry on or about 1 April 2002. The Applicant lost 356 potential certificates from 17 installations.
25.PowerWater submits that in automatically removing the entries in the “Maintain Solar Water Heaters” section of the REC-Registry, the Regulator was in fact making a decision, pursuant to section 26 (5) of the Act, determining the Certificates were not eligible for registration.
26.The Respondent submits that the Certificate has to be created in the prescribed manner via the REC-Registry and then the Regulator may or may not register the valid certificate. It is the decision to register or not register a valid certificate that the Tribunal has power to review, pursuant to section 66 Item 4 of the Act..
27.The Tribunal was informed that PowerWater had successfully followed the process and created some 2000 RECs which were registered, prior to the occasion which gave rise to this application.
JURISDICTION
28.The Administrative Appeals Tribunal may only review those decisions which are covered by an enactment which allows for such review. Section 25 of the Administrative Appeals Tribunal Act 1975 provides:
“(1) An enactment may provide that applications may be made to the Tribunal:
(a)for review of decisions made in the exercise of powers conferred by that enactment.
..
(3) Where an enactment makes a provision in accordance with subsection (1), that enactment:
(a)shall specify the person or persons to whose decisions the provisions applies;
(b)may be expressed to apply to all decisions of a person, or to a class of such decisions;
(c)may specify conditions subject to which applications may be made.”
29.The Renewable Energy (Electricity) Act 2000, provides for certain decisions made under that Act to be reviewed by the AAT. They are:
“Section 66 Review of Decisions
(1) An affected person in relation to a reviewable decision may request that the Regulator reconsider the decision. The following table sets out the reviewable decisions and, for each decision, sets out the provision under which it is made and the affected person in relation to it.
Table of reviewable decisions Item For a decision ... made under ... the affected person is ... 1 to refuse to register a person section 11 the person. 2 in relation to an application for accreditation of a power station section 14 the applicant for accreditation. 3 to refuse to accredit a power station section 15 the applicant for accreditation. 4 not to register a certificate section 26 the person who created the certificate. 5 to suspend a person’s registration section 30 the registered person. 6 assessing additional renewable shortfall charge section 102 the liable entity that is liable to pay the additional renewable energy shortfall charge. 7 not to remit, or to remit only a part of, additional renewable energy shortfall charge section 103 the liable entity that is liable to pay the additional renewable energy shortfall charge. (2)The request must be:
(a)in writing; and
(b)given to the Regulator within 60 days of the making of the decision.
(3)The Regulator must reconsider the decision and confirm, vary or set aside the decision.
Note:Section 27A of the Administrative Appeals Tribunal Act 1975 requires the person to be notified of the person’s review rights.
(4)The Regulator is taken to have confirmed the decision under subsection (3) if the Regulator does not give written notice of the Regulator’s decision under that subsection within 60 days of the request.
(5)Applications may be made to the Administrative Appeals Tribunal for review of a decision of the Regulator under subsection (3) to confirm, vary or set aside the decision.”
30.The only Item in the table above which has relevance to this matter is Item 4 which relates to “not to register a certificate section 26” and the “affected person is the person who created the certificate”.
31.A valid certificate must exist before the Tribunal has the jurisdiction to review a decision by the Respondent to not register it.
32.The Regulator has put in place a prescribed electronic database for the creation of certificates. It is clear from the structure of the database that there are two options, either to create certificates or to have some entries held back for later creation dates. PowerWater elected to take the latter course and in this case failed to create certificates.
33.The Tribunal has jurisdiction in relation to the registration of certificates but not in relation to the creation of certificates.
34.The Tribunal has no jurisdiction to review the matter of the automatic deletion from the Respondent’s database of the entries of PowerWater for potential RECs, 12 months after they were entered.
I certify that the 34 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President, Don Muller
Signed: .......................................................................................
C. O’Donovan, AssociateDate/s of Hearing 4 December 2002
Date of Decision 10 July 2003
Applicant Mr. I. Hemming
Solicitor for the Respondent Ms. V. Masters, Australian Government Solicitor
0
0
0