The AEMC today initiated work on a rule request from AEMO to improve the arrangements under which compensation is paid to market participants when AEMO intervenes to maintain security and reliability.
At present, a $5,000 threshold applies per trading interval, which currently limits the amount of compensation payable to directed and affected participants when AEMO intervenes in the market to maintain security and reliability. AEMO proposes that this threshold should instead apply per intervention event, rather than per trading interval.
AEMO is proposing this on the basis that the current approach creates a risk that participants will be out of pocket if the amount of compensation owed to them does not exceed the threshold in a given trading interval. This is particularly the case where intervention events are lengthy (comprising many trading intervals). The application of the threshold in its current form could result in participants incurring loss.
This rule request is being progressed as part of the AEMC’s investigation into intervention mechanisms and system strength in the NEM. Further information on this can be found here.
Media: Prudence Anderson, Communication Director, 0404 821 935 or (02) 8296 7817