Rule Change: Completed

Overview

The AEMC has made a rule that increases the dollar amount for the participant compensation fund (PCF) in relation to the short term trading market (STTM) Brisbane hub. Increasing the PCF amount decreases the risk that trading participants will not be adequately compensated for costs incurred as a result of scheduling errors in the STTM. Reducing the financial risk faced by trading participants may result in marginally lower costs, which is likely to benefit consumers of natural gas in terms of price.
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On 28 February 2013, the AEMC published a final rule determination and final rule for the STTM Brisbane participant compensation fund rule change request.</p>
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The final rule is the same as the rule proposed by the Australian Energy Market Operator (AEMO), with some modifications to the transitional provisions.</p>
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The rule commences on 7 March 2013. This will allow time for AEMO to apply the new PCF amount, with appropriate notice to market participants, from 1 July 2013.</p>
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<strong>Background</strong></p>
<p>
On 10 August 2012, AEMO submitted the rule change request to the AEMC. It sought to increase the dollar amount for the STTM Brisbane PCF from $100,000 to $450,000. Also, it sought to increase the maximum PCF amount that can be recovered from trading participants in one year from $50,000 to $225,000. AEMO considered that the amount specified in the current National Gas Rules is too small and does not reflect the size of the Brisbane market.</p>
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The AEMC assessed the rule change request under an expedited process, which is possible under the National Gas Law for rule changes that are considered to be non-controversial.</p>

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