26Tendering for LTES agreements—the Act, s 47(3)(a)

26 Tendering for LTES agreements—the Act, s 47(3)(a)

26 Tendering for LTES agreements—the Act, s 47(3)(a)

(1) The consumer trustee must conduct a competitive tender in a way that—

(a) encourages genuine competition between the persons making tender bids, and

(b) encourages competition between market participants, and

(c) encourages tender bids from persons who are not already parties to LTES agreements, and

(d) is transparent, open and fair for all persons making tender bids.

(2) Subclause (1)(d) does not require the consumer trustee to disclose information the consumer trustee considers confidential or commercially sensitive.

(2A) Before conducting a competitive tender involving an LTES agreement for the construction and operation of generation infrastructure that includes an option to exercise a derivative arrangement that is not a fixed shape, fixed volume derivative arrangement, the consumer trustee must be satisfied that—

(a) the arrangement is in the long-term financial interests of NSW electricity customers, and

(b) the arrangement allows for the reasonable forecasting of financial impacts to NSW electricity customers, including impacts arising from the volume of electricity produced by the LTES operator throughout the day and over the term of the agreement, and

(c) the risks, including the basis risk, associated with the arrangement can be managed under the risk management framework.

(3) When conducting a competitive tender, the consumer trustee must consider recent trends and changes in the following—

(a) electricity infrastructure technology,

(b) the national electricity market,

(c) the behaviour of customers and market participants.

(4) The assessment of the financial value of a tender bid must consider the effect of the infrastructure proposed to be constructed and operated under an LTES agreement on the following—

(a) wholesale electricity costs,

(b) the costs of network infrastructure, including REZ network infrastructure projects, required to support the infrastructure that will be constructed and operated under the LTES agreement,