The National Electricity Market (NEM) is a wholesale exchange for electricity for the Commonwealth adjacent areas and those States and Territories that are electrically connected - Queensland, NSW, ACT, Victoria, South Australia and Tasmania. The NEM commenced operation on 13 December 1998 with just NSW and Victoria, with other regions progressively joining since then.
The Australian Energy Market Operator (AEMO) was established on 1 July 2009 and its functions include implementing, administering and operating the wholesale exchange and managing the security of power system.
The development of the NEM was part of the broad energy reforms undertaken over the last decade.
The National Electricity Objective
The National Electricity Objective, as stated in the National Electricity Law is:
to promote efficient investment in, and efficient operation and use of, electricity services for the long term interests of consumers of electricity with respect to –
- price, quality, safety, reliability, and security of supply of electricity; and
- the reliability, safety and security of the national electricity system.