A negotiated connection applies where a new or altered electricity supply cannot be delivered under as a basic connection or standard connection. These connections typically involve significant network augmentation, bespoke technical studies, or tailored commercial terms that fall outside the AER’s approved model standing offer framework.

Key points

• Negotiated connections are used when a project cannot be handled through a basic or standard connection service.
• They often apply to large commercial or industrial loads, embedded generators, BESS and hybrid systems.
• DNSPs may require detailed studies for power quality, protection, voltage, harmonics, fault levels and network capacity.
• The applicant may need to fund augmentation or new connection assets.
• Negotiated connection timeframes can extend over several months depending on network constraints and project complexity.

When is a negotiated connection required?

A negotiated connection is usually required for:

• Large industrial or commercial customers with demand typically above 1 MVA, an
• An embedded generator, BESS or hybrid system above 200 kW
• Connections that trigger upstream network reinforcement or complex supply configurations
• Projects that require engineering studies, bespoke protection schemes, and cost recovery for augmentation.

Systems above 200 kW (such as an embedded generator, BESS, or a hybrid system) and customer loads exceeding 1 MVA typically fall outside the scope of basic or standard connections due to their complexity and potential network impacts. These projects are typically assessed under Chapter 5A as negotiated connections unless they require registration with AEMO, in which case they follow the Chapter 5 access arrangements process. They may also trigger upstream reinforcement, voltage support, or bespoke connection arrangements, particularly in constrained areas or networks with limited hosting capacity.

How does this affect CER projects?

Understanding the negotiated connection pathway is critical for CER project developers such as a community-scale battery. It frames both the technical capabilities (e.g. dispatchable power and export limits) and the economic feasibility (through connection charges and augmentation costs) that ultimately determine whether project is technically and commercially viable.

What terms are negotiated with the DNSP?

Under Chapters 5 and 5A of the NER, a negotiated connection allows customers and DNSPs to agree on tailored terms reflecting site-specific requirements. This typically includes:

• the technical standards to be applied (e.g. power quality, protection, stability, and harmonic studies)
• the scope of works required for augmentation, reinforcement, or new connection assets
• the allocation of costs between the customer and DNSP in line with AER’s Connection Charge Guidelines
• the timeframes for design, assessment, and construction.

Negotiated connections are required when the connection service is not classified as a basic connection or a standard connect, often due to complexity, load/generation size, or site-specific network impacts. These connections must meet detailed technical requirements to ensure safe and secure integration with the distribution (or transmission) network. This may involve network protection schemes, inter-trip or runback systems, voltage control, and power quality compliance.

The connection applicant typically funds any required augmentation to maintain safety, reliability, or quality of supply, consistent with the AER’s Connection Charge Guidelines. DNSPs may also require demonstration of compliance with grid codes, harmonic emission, and fault current contribution thresholds.

How does the negotiated connection process work?

The process is significantly more complex and resource-intensive than basic or standard connections. It generally begins with a preliminary enquiry, followed by a detailed enquiry phase where the DNSP undertakes technical assessments. This leads into formal negotiations on performance standards, augmentation scope, cost responsibility, and delivery timelines. Once terms are finalised, a connection agreement (including potentially a dynamic connection agreement) is executed, after which detailed design, procurement, and construction commence. Timeframes vary significantly depending on network constraints, augmentation needs, and project complexity, often extending over several months.

Related articles

• Basic connection service
• Standard connection service
• Connecting a generator to a distribution network