In accordance with rule 492 of the National Gas Rules, the Australian Energy Market Operator (AEMO) is conducting a review of market parameters in the Short Term Trading Market (STTM). AEMO is required to use the extended consultative procedure set out in rule 9A of the National Gas Rules.
While there is no mandated review of the market parameters in the Declared Wholesale Gas Market (DWGM), AEMO is taking the opportunity to review the DWGM market parameters in conjunction with the STTM parameter review.
The parameters being reviewed are:
|
Parameter |
STTM |
DWGM |
|
Market Price Cap (STTM) / VoLL (DWGM) |
$400 per GJ |
$800 per GJ |
|
Minimum Market Price |
$0 per GJ |
$0 per GJ |
|
Administered Price Cap |
$40 per GJ |
$40 per GJ |
|
Cumulative Price Threshold (CPT)
|
110% of Market Price Cap $440 per GJ |
$1,800 per GJ |
|
CPT Horizon (STTM) Cumulative Price Period (DWGM) |
7 days |
35 Scheduling Intervals (7 days) |
Approach
AEMO has appointed a consultant (Market Reform Pty Ltd) to model and make recommendations as to the values of the following parameters in both the STTM and DWGM:
- Market Price Cap / VoLL
- Administered Price Cap
- Cumulative Price Thresholds
AEMO will review the values of the following parameters in both the STTM and DWGM:
- Minimum Market Price
- CPT Horizon / Cumulative Price Period
Should AEMO’s final report recommend changes to any market parameter, AEMO will initiate an appropriate regulatory change process to implement the new parameters with effect from 1 July 2020. Under rule 492(3) of the National Gas Rules, changes to the relevant parameter may come into effect from 1 July 2019 where assumptions on which the current parameter values were based have been shown to be materially incorrect.
Review Timetable
|
Stage |
Date |
|
Initiation |
June 2017 Gas Wholesale Consultative Forum (GWCF) |
|
GWCF Workshop |
3 November 2017 |
|
Consultation Paper published |
8 December 2017 |
|
Submissions on Consultation Paper |
COB 24 January 2018 |
|
Presentation on modelling results |
February 2018 GWCF (Tue 13 February 2018) |
|
Draft Report published |
9 March 2018 (revised) |
|
Submissions on Draft Report |
COB 26 March 2018 (revised) |
| Final Report | no later than 30 April 2018 |
Initiation
Relevant papers from the June GWCF were:
- GWCF paper – June 2017 – Gas Market Parameter review (205 KB, pdf)
- Final scope of works – Modelling – Gas Market Parameter Review 2018 (176 KB, pdf)
Workshop
Presentations to the GWCF workshop were:
- GWCF Workshop – Gas Market Parameter Review – AEMO presentation (565 KB, pdf)
- GWCF Workshop – Gas Market Parameter Review – Market Reform presentation (1.7 MB, pdf)
Consultation
- Market Notice for Consultation (300 KB, pdf)
- Gas Market Parameter Review 2018 - Consultation Paper (743 KB, pdf)
- Attachment 1 - Gas Market Parameter Review 2018 - Consultation report - Market Reform Pty Ltd (1.2 MB, pdf)
- Attachment 2 - Gas Market Parameter Review 2018 - Consultation - Submission template (143 KB, doc)
Submissions on the Consultation paper are invited from consulted parties by no later than COB Wednesday 24 January 2018 to gwcf_correspondence@aemo.com.au. Consulted parties should use the submission form above.
Gas Market Parameter Review Workshop – February 2018
- AEMO slides to Gas Market Parameter Review Workshop (187 KB, pdf)
- Market Reform - Progress Report - Gas Market Parameter Review 2018 (1.1 MB, pdf)
- Workshop Notes (179 KB, pdf)
Submissions received
Submissions to Consultation
- Origin Energy Limited (211 KB, pdf)
- Snowy Hydro Limited (263 KB, pdf)
Submission to the Workshop
- ERM Power Limited (307 KB, pdf)
- M2 Energy Limited (190 KB, pdf)
- COVAU PTY Limited (263 KB, pdf)
Summary of Submissions
- Summary of Submissions (198 KB, pdf)
Draft Report
Details of Draft Report
- Market Notice for Consultation on Draft Report (169 KB, pdf)
- Gas Market Parameter Review 2018 – Draft Report (570 KB, pdf)
- Attachment 1 – Gas Market Parameter Review 2018 – Draft report – Market Reform Pty Ltd (1.3 MB, pdf)
Submissions received to Draft Report
- Alinta Energy (278 KB, pdf)
- Meridian Energy Australia Pty Ltd (218 KB, pdf)
- Origin Energy (216 KB, pdf)
Summary of Submissions
- Summary of Submissions (187 KB, pdf)
Final Report
Details of Final Report
- Gas Market Parameter Review 2018 – Final Report (566 KB, pdf)
- Attachment 1 – Gas Market Parameter Review 2018 – Final Report – Market Reform Pty Ltd (975 KB, pdf)