Rule changes: Open

The AEMC has published a draft determination on the rule change request from the Reliability Panel in relation to the expiry of the Reliability and Emergency Reserve Trader (RERT), and the obligation placed on the Reliability Panel to review the RERT a year prior to its expiry.

On 15 December 2011, the AEMC published a draft determination on the Reliability Panel's rule change request. The draft determination proposes to postpone the expiry of the RERT for a period of four years to 30 June 2016, and remove the obligation on the Reliability Panel to review the RERT a year prior to its expiry.

Requests for a public hearing close on 22 December 2011. Submissions on the draft determination close on 2 February 2012.

Background

The Reliability Panel submitted the rule change request on 1 July 2011. It seeks to postpone the expiry of the RERT by one year, from 30 June 2012 to 30 June 2013 as a transitional measure and allow the RERT to expire from the NER on 30 June 2013. It also seeks to remove from the NER the requirement for a Reliability Panel initiated review of the RERT mechanism.

The rule change request would require two amendments to the NER. To postpone the expiry date of the RERT would require an amendment to clause 3.20.1, which contains the current sunset date of the RERT. Subsequently, removing the obligation on the Reliability Panel to review the RERT mechanism would require the deletion of clause 3.20.9 from the NER.

The proponent's rationale for the rule change is that the market has performed adequately and sufficient supply has been achieved without the RERT, even during times of uncertainty in the market, therefore it is no longer required. However, the proponent considers that the expiry date should be extended by one year to allow those that would be affected adequate notice of the change.

The proponent initially requested that its rule change request be fast-tracked owing to the substantial consultation undertaken by the Reliability Panel. However, the AEMC considers that the Australian Government's proposed carbon price legislation is a sufficient policy change since consultation was undertaken, therefore it will follow the standard rule making process.