The National Electricity Amendment (EnergyAustralia Participant Derogation Extension (Settlement Residue Auctions)) Rule 2009 No.14 commences operation on 1 July 2009. The Rule was made by the Commission in response to a Rule change proposed by EnergyAustralia. The main impact of the Rule is that it provides EnergyAustralia with an unambiguous right to participate in Settlement Residue Auctions (SRAs) through to 30 June 2012. The main benefit of the Rule are that EnergyAustralia's participation in the SRA market will increase the level of competition for SRA units in general, which will improve the potential for efficient price outcomes from the SRA market, and support greater efficiency in the overall market for financial hedge instruments. This leads to benefits for end users in the National Electricity Market (NEM) through more efficient energy market prices.

Background

On 30 March 2009, the Commission received a Rule Change proposal from EnergyAustralia (EA).

The Rule change proposal sought to extend EA's existing Participant Derogation that permits EA to participate in SRAs. EA proposed that the sunset date applicable to its existing Participant derogation be extended by three years to 30 June 2012.

On 30 April 2009, the Commission published a notice under sections 95 and 96 of the National Electricity Law (NEL) commencing first round consultation on this Rule Change Proposal and advising of its intention to expedite the Rule change process on the grounds that it was non-controversial, subject to the receipt of written objections. The Commission was of the view that the proposed Rule was unlikely to have a significant effect on the NEM as the proposed Rule proposed to extend existing arrangements.

In relation to the Rule change proposal:

• Written objections to expediting the Rule change process under section 96 of the NEL were due by 15 May 2009; and
• Submissions had to be received by 29 May 2009.

 No objections were received. One submission from NEMMCO was received.

On 11 June 2009, the Commission gave notice under sections 102 and 103 of the NEL of the making of the National Electricity Amendment (EnergyAustralia Participant Derogation (Settlement Residue Auctions)) Rule 2009 No. 14 and the corresponding Rule determination. This Rule was made under an expedited process in accordance with section 96 of the NEL.

The Rule as Made extends the sunset date applicable to EA's existing participant derogation, that permits EA to participate in SRAs, by three years to 30 June 2012. The Rule as Made commences on 1 July 2009.