Final rule determination made on market schedule variation transactions

On 30 August 2012, the AEMC published a final rule and associated final rule determination on market schedule variation transactions in the short term trading market (STTM) for gas.

The rule enables users in the STTM to submit market schedule variations (MSVs) to AEMO.  As a result, direct MSVs between users in the STTM are now possible. MSVs are an important mechanism for participants in the STTM to avoid deviation penalties.

The rule published today reduces the number of transactions needed to complete a user-to-user MSV. It increases efficiency with which these MSVs can be undertaken and gives more flexibility in how MSVs can be processed.

The rule will better facilitate market practices. This is likely to benefit trading participants in the STTM, from which, ultimately, consumers of gas would be able to benefit in terms of price (although this benefit is likely to be marginal).

The rule commences 19 March 2013. This commencement date allows for the necessary changes to the STTM Procedures and relevant IT systems to be made by AEMO.

Rule change process

The rule change was requested by AEMO. It sought to make MSV transactions more efficient by allowing two users who wish to submit an MSV to do so directly with AEMO. Prior to the rule change, an MSV between two users was only possible with a shipper acting as intermediary.

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.

The AEMC requested written notification from any stakeholder who objected to the rule being assessed under the expedited process. No such objections were received and accordingly, the AEMC proceeded with the expedited process. Under this process, no draft determination is provided.