Electricity market participants

A wide variety of people, businesses and organisations participate in the two electricity markets operated by AEMO. The roles played by these participants – from generation to purchasing – are classified as specific ‘participant categories’, which reflect the registration requirements, responsibilities and functions of each type of participant.

National Electricity Market (NEM) participant categories

The National Electricity Market (NEM) operates in Australia’s eastern and south-eastern states and has a number of Registered Participant categories that – in certain cases – are broken down further into different classifications. Participants may be registered in more than one Registered Participant category.

Integrated Resource Provider

Any person who owns, controls or operates an integrated resource system connected to a transmission or distribution network must register as an integrated resource provider, except where they meet the exemption criteria.

Each of the integrated resource provider’s registered production units (bidirectional units or generating units) must be classified as market or non-market depending if the sent-out electricity is sold through the spot market and classified as scheduled, non-scheduled or semi-scheduled depending on how the production units participates in central dispatch.

A person may also register in the category of Integrated Resource Provider to undertake the activities of a:

Generator

Any person who owns, controls or operates a generating system connected to a transmission or distribution network must register as a generator or an Integrated Resource Provider, except where they meet the exemption criteria.

Each of the registered generating units must be classified as market or non-market depending if the sent-out electricity is sold through the spot market and classified as scheduled, non-scheduled or semi-scheduled depending on how the generating unit participates in central dispatch.

Integrated Resource Provider, Small Resource Aggregator (IRP, SRA)

An IRP, SRA can supply electricity aggregated from one or more small production units, which are connected to a distribution or transmission network at a small resource connection point. A small production unit is owned, controlled and/or operated by a person who AEMO has exempted from the requirement to register as a generator or an integrated resource provider with respects to the production unit. An IRP SRA is a market participant.

Customer

A customer is a registered participant that purchases electricity supplied through a transmission or distribution system and consumed at a market connection point. Electricity may also be generated from small production units at these market connection points. Retailers and end users who buy (or sell) electricity in the spot market must be registered as Market Customers or Integrated Resource Providers.

Network Service Provider (NSP) - including Special Participant

A person who owns, operates or controls a transmission or distribution system must register with AEMO as an NSP. The Australian Energy Regulator may exempt a person from registering as an NSP if the person meets specific criteria or if they are appointing an intermediary.

When registering, NSPs must categorise each of their network systems as either a transmission system or distribution system. NSPs either earn revenue from a regulated income or from the spot market. The latter must register as market NSPs and classify their services as scheduled network services. Market NSPs must participate in AEMO’s central dispatch process.

Reallocator

Anyone that wishes to participate in a reallocation transaction must register as a reallocator. A reallocator must be a “wholesale client” as defined in the Corporations Act 2001 (Cth).

A reallocation transaction is undertaken with the consent of two market participants and AEMO. AEMO credits one market participant with a positive trading amount for a trading interval, and debits a matching negative trading amount to the other market participant for the same trading interval. These may be specified dollar amounts, or calculated by reference to a specified quantity of energy and price. These amounts are typically underpinned by a contract between the credit and debit parties, but AEMO is not a party to that contract.

Trader

Anyone who wants to take part in a Settlements Residue Auction and is not already registered as a customer or generator, must register as a trader.

Metering Coordinator

A metering coordinator is a Registered Participant with the overall responsibility for coordination and provision of metering services at a connection point in the NEM.

Demand Response Service Provider

A Demand Response Service Provider (DRSP) delivers:

• market ancillary services in accordance with the National Electricity Rules and AEMO’s market ancillary services specifications, by classifying plant at a market connection point as ASU and offering it into FCAS markets.
• wholesale demand response in accordance with the National Electricity Rules and the Wholesale Demand Response Guidelines by allowing large customers to enter into a contract with a DRSP to provide demand response by reducing load.

A DRSP need not be the customer’s retailer. In practice, this may mean that while a customer has a retail supply contract with a retailer, a customer may also have a separate contract with a DRSP to provide ancillary services or wholesale demand response.

Intending Participant

A person may apply for registration as an intending participant if they can reasonably satisfy AEMO that they intend to commence activities that require them to be a registered participant.

Wholesale Electricity Market (WEM) participant categories

The Wholesale Electricity Market (WEM) in Western Australia uses ‘Rule Participant classes’ that categorise the role the person or business plays in the market and the rules that apply to them. A Rule Participant can belong to more than one class, except where this is explicitly restricted.

Market Generator

Anyone who owns, controls or operates a generating facility that’s connected to the South West Interconnected System (SWIS) is a Market Generator, although registration is optional in some instances. 

Anyone who is intending to own, control or operate a generator, but is not ready to participate in the market, can also register as a Rule Participant.

Market Customer

A participant that sells, or intends to sell, electricity to customers is a Market Customer, although there are some exemptions to the requirement to register.

Network Operator

Anyone who owns, controls or operates a transmission or distribution network in the SWIS is a Network Operator, although some exemptions apply. 

Anyone who is intending to own, control or operate a transmission or distribution network, but is not ready to participate in the market, can also register as a Rule Participant.

Ancillary Service Provider

Generators that wish to provide load following ancillary services  (LFAS) – which help AEMO to regulate system frequency – and other ancillary services must also register as an Ancillary Service Provider.