The Australian Energy Market Commission (AEMC) has published a final determination expanding credit support options available to participants in the National Electricity Market, with particular benefits for smaller retailers and consumers. 

The final rule will allow participants to provide up to $20 million each in cash as credit support, in addition to existing bank guarantee and letter of credit options. 

AEMC Chair Anna Collyer said the rule modernises credit support arrangements and delivers broad market benefits.

"While this rule change was initially requested by Delta Electricity to address specific financing challenges, our consultation revealed much broader market issues affecting many participants," Ms Collyer said.

"The final rule improves flexibility and reduces costs for all participants, with particular benefits for smaller retailers who face higher financing costs and barriers to entry. This will enhance retail competition and deliver benefits to consumers through lower prices."

Under current rules, net debtors in the market – typically retailers who purchase electricity and owe money to the market – must provide a bank guarantee or bank letter of credit as credit support. Securing these guarantees often involves lodging cash with the lender and paying fees.

The new cash option enables participants to provide cash as credit support directly to AEMO, avoiding reliance on third-party lenders and reducing risks of administrative delays that could prevent timely credit support provision. 

Small and prospective retailers are expected to benefit most, as they typically have higher financing costs and limited access to capital compared to larger participants.

The AEMC responded to strong stakeholder support by increasing the cash limit from $5 million proposed in the draft to $20 million in the final rule.

The final determination also includes multiple layers of legal protections to prevent cash from being reclaimed if a participant becomes insolvent, and allows AEMO to distribute any delayed payments to other participants more efficiently. 

The final rule commences on 1 November 2026, as recommended by AEMO based on implementation requirements and coordination with other major market reforms.

Visit the project page for more information and contact details.  

Media: Jessica Rich 0459 918 964 or media@aemc.gov.au