The legal framework underpinning the Peak Demand Reduction Scheme (PDRS) is developed by the Department of Climate Change, Energy, the Environment and Water (DCCEEW). It includes:

  • Electricity Supply Act 1995
  • Electricity Supply (General) Regulation 2014 
  • Peak Demand Reduction Scheme Rule of 2022
  • Peak Demand Reduction Scheme Compliance Rule of 2022
  • Peak Demand Reduction Scheme (Electricity Load Exemptions) Order.

The Act

The Electricity Supply Act 1995 (the Act) established the PDRS under Part 2 of Schedule 4A to the Act. It sets out the legal framework of the PDRS including the functions and responsibilities of IPART as Scheme Administrator and Scheme Regulator.

The Regulation

The Electricity Supply (General) Regulation 2014 (the Regulation) supports the Act and provides more detail about the core functions of the Scheme Administrator and the Scheme Regulator.

Part 7 of the Regulation sets out:

  • peak demand reduction targets, the peak demand period and PDRS penalty rates
  • for the Scheme Administrator, requirements for accrediting and auditing Accredited Certificate Providers, and rules around creating and transferring Peak Reduction Certificates.
  • for the Scheme Regulator, the principles governing compliance with the individual certificate targets for Scheme Participants.

The PDRS Rule

The Peak Demand Reduction Scheme Rule of 2022 (PDRS Rule) supports the Act and Regulation. It applies to Accredited Certificate Providers (ACPs) and peak demand reduction activities. It provides details about:

  • Recognised Peak Activities
  • information that must be provided to create a Peak Reduction Certificate (PRC)
  • eligibility, equipment and implementation requirements for each activity definition
  • calculation methods for determining the number of peak reduction certificates that can be created.

The Activity Definitions in the first version of the PDRS Rule closely relate to Activity Definitions in the Energy Savings Scheme. Further details are available on our Calculation methods and Reducing Demand Using Efficiency pages.

PDRS Compliance Rule

The Peak Demand Reduction Scheme Compliance Rule of 2022 (PDRS Compliance Rule) supports the Act and sets out:

  • how the Scheme Regulator must calculate the forecast peak demand for the compliance period and
  • the method Scheme Participants must use to determine the individual liable demand where electricity is not purchased from AEMO and not measured by an interval meter.

The Ministerial Order - Exempt Electricity Loads

The Act allows the Minister to publish an Order in the Gazette granting a full or partial exemption from the PDRS for electricity loads used for:

  • some emissions intensive and trade exposed energy activities, or
  • the production of green hydrogen (sch 4A cl 93).

The Ministerial Order applying to the 2023-24 compliance period is the Peak Demand Reduction Scheme (Electricity Load Exemptions) Order 2023 (PDRS Exemptions Order).

The PDRS Exemptions Rule

The Minister authorises the Scheme Regulator to make rules relating to the treatment of exempt electricity loads. This is authorised in the PDRS Exemptions Order.

The Peak Demand Reduction Scheme - Scheme Regulator Exemptions Rule No.1 of 2023 (PDRS Exemptions Rule) outlines:

  • how deductions for exempt electricity loads are calculated
  • how deductions for losses are calculated, and
  • how Scheme Participants establish their entitlement to the exemption.