Part 2ARetailer Reliability Obligation

Part 2A—Retailer Reliability Obligation Division 1—General 14C—Definitions contract position day—see section 14K(4)(b)(i); forecast reliability gap—see section 14G(1); forecast reliability gap period—see section 14G(2); Ministerial reliability gap and Ministerial reliability gap period—see section 14JA(1)(b); net contract position—see section 14O(3); one‑in‑two year peak demand forecast, for a region during a specified period, means the peak demand forecast in accordance with the Rules— (a) to occur for the region during the period; and (b) where the likelihood is that the forecast amount will be exceeded once in any two‑year period; peak demand, for a period in a region, means the maximum electricity demanded, in megawatts, in the region during the period, determined in accordance with the Rules; region means a region of the national electricity market determined under the Rules; reliability gap period, in relation to a T‑1 reliability instrument, means the forecast reliability gap period stated in the instrument; reliability instrument means a T‑3 reliability instrument or a T‑1 reliability instrument; reporting day—see section 14K(4)(b)(ii); T‑1 cut‑off day—see section 14G(4); T‑1 reliability instrument means a reliability instrument for a forecast reliability gap made by the AER under section 14K that relates to the T‑1 cut‑off day for the forecast reliability gap; T‑3 cut‑off day—see section 14G(3); T‑3 reliability instrument means— (a) a reliability instrument for a forecast reliability gap made by the AER under section 14K that relates to the T‑3 cut‑off day for the forecast reliability gap; or (b) a reliability instrument for a Ministerial reliability gap period made by a Minister of a participating jurisdiction under section 14JA; trading interval means a period prescribed by the Rules to be a trading interval for the wholesale exchange; wholesale exchange means the wholesale exchange for electricity operated and administered by AEMO under this Law and the Rules. 14D—Meaning of liable entity for a region (1) Each of the following is a liable entity for a region: (a) a person who is a Registered participant mentioned in section 11(4)(a); (b) a person mentioned in section 11(4)(b) prescribed by the Rules to be a liable entity for the reliability obligations; (c) another person who has elected, under section 14E, to assume responsibility for the reliability obligations of a person mentioned in paragraph (a). (2) However, a person mentioned in subsection (1)(a) is not a liable entity for a region— (a) if the person is a Registered participant mentioned in subsection (1)(a) who is prescribed by the Rules not to be a liable entity for the reliability obligations; or (b) to the extent a person mentioned in subsection (1)(c) has elected to assume the person's responsibility for the reliability obligations for the region. 14E—Process for non‑liable persons to opt in to reliability obligations (1) This section applies to a person— (a) if— (i) the person purchases electricity supplied in a region from a liable entity; and (ii) the person's annual consumption of electricity is more than the threshold prescribed by the Rules for this section; or (b) prescribed by the Rules to be eligible to make an election under this section. (2) The person may elect to assume all or some of the liable entity's responsibility for the reliability obligations in relation to the electricity purchased for the period stated in the election. (3) An election under subsection (2) must— (a) state the extent to which the person has elected to assume the liable entity's responsibility; and (b) be made in the manner, form and timeframes required by the Rules. Division 2—Reliability forecasts and instruments 14F—Annual forecast for reliability gaps Each year, AEMO must— (a) perform the functions stated in the Rules for the purposes of forecasting for the occurrence of reliability gaps in future years; and (b) prepare and publish, in the manner, form and timeframes required by the Rules, information about the forecasting. 14G—Meaning of forecast reliability gap, forecast reliability gap period, T‑3 cut‑off day and T‑1 cut‑off day (1) A forecast reliability gap occurs when the amount of electricity forecast for a region, in accordance with the Rules, does not meet the reliability standard to an extent that, in accordance with the Rules, is material and a reference in this Part to a forecast reliability gap includes, where the context requires, a reference to a Ministerial reliability gap. (2) A forecast reliability gap period is the period during which a forecast reliability gap is forecast to occur and a reference in this Part to a forecast reliability gap period includes, where the context requires, a reference to a Ministerial reliability gap period. (3) The T‑3 cut‑off day for a forecast reliability gap is the day that is 3 years before the day the forecast reliability gap period for the forecast reliability gap starts. (4) The T‑1 cut‑off day for a forecast reliability gap is the day that is 1 year before the day the forecast reliability gap period for the forecast reliability gap starts. reliability standard means the standard prescribed by the Rules for the reliability of electricity for the national electricity market. 14H—Rules must provide timetable for reliability forecasts, requests and instruments (1) The Rules must provide for timeframes for the following matters in relation to a forecast reliability gap: (a) the period, that ends at least the stated number of days before the T‑3 cut‑off day and T‑1 cut‑off day, during which— (i) AEMO must make a request under section 14I; and (ii) the AER must decide whether to make a reliability instrument under section 14K; (b) the period— (i) ending on or before the T‑1 cut-off day, during which the contract position day must be set; and (ii) ending on or after the T‑1 cut-off day, during which the reporting day must be set; (c) the periods that apply for the matters mentioned in paragraph (a) or (b) if AEMO corrects a request under section 14J. (2) Also, the Rules must provide for 1 or more ways to determine whether a request for the AER to make a T‑1 reliability instrument under section 14I is related to a T‑3 reliability instrument. (3) For subsection (2), a prescribed way may include the extent to which the reliability gap period and trading intervals stated in a request for the AER to make a T‑1 reliability instrument must be the same as, or may be different to, the forecast reliability gap period and trading intervals stated in the T‑3 reliability instrument. (4) In addition, for subsection (2), in the case of a T‑3 reliability instrument made by a Minister of a participating jurisdiction, a prescribed way may include the extent to which the reliability gap period and trading intervals stated in a request for the AER to make a T‑1 reliability instrument must be the same as, or may be different to, any Ministerial reliability gap period or trading intervals stated in the T‑3 reliability instrument. 14I—AEMO must request reliability instrument (1) This section applies if— (a) AEMO is satisfied a forecast reliability gap is forecast to occur in a region; and (b) AEMO has published the information about the forecast that AEMO is required to publish under section 14F(b). (2) Subject to subsection (3), AEMO must request the AER to consider making a reliability instrument for the region in relation to the forecast reliability gap. (3) AEMO must make a request under subsection (2) for a T‑1 reliability instrument for a region only if the AER has made a related T‑3 reliability instrument or the Minister of the participating jurisdiction in which the region is located has made a related T‑3 reliability instrument. (4) A request under subsection (2)— (a) is made by giving a written notice about the request to the AER; and (b) must be made within the period required by the Rules; and (c) must state the following information about the forecast reliability gap: (i) the region in which the forecast reliability gap is forecast to occur; (ii) the first and last days of the forecast reliability gap period; (iii) for a request for a T‑3 reliability instrument—the trading intervals, during the forecast reliability gap period, for which liable entities may be required to hold net contract positions that are sufficient to meet their share of the one-in-two year peak demand forecast for the forecast reliability gap period; The trading intervals between 4pm and 8pm each weekday during the forecast reliability gap. (iv) for a request for a T‑1 reliability instrument—the trading intervals, during the forecast reliability gap period, for which liable entities will be required to hold net contract positions that are sufficient to meet their share of the one-in-two year peak demand forecast for the forecast reliability gap period if the T‑1 reliability instrument is made; The trading intervals between 4pm and 8pm each weekday during the forecast reliability gap. (v) AEMO's one‑in‑two year peak demand forecast for the forecast reliability gap period. (5) A request under subsection (2)— (a) may only apply to 1 forecast reliability gap period; and (b) may be made on more than 1 occasion in a year for different forecast reliability gap periods in the same region or in different regions. 14J—AEMO may correct request for reliability instrument (1) This section applies if a request under section 14I contains— (a) a material miscalculation of figures; or (b) a material mistake in the description of a person, period, thing or matter referred to in the request; or (c) a defect in form. (2) AEMO may correct the request by giving a written notice about the correction, and a correct request, to the AER. 14JA—Minister may make T‑3 reliability instrument (1) Subject to this section, a Minister of a participating jurisdiction may make a T‑3 reliability instrument for a region if— (a) the geographical area of the participating jurisdiction constitutes the whole or a part of the region; and (b) it appears to the Minister, on reasonable grounds, that there is a real risk during a period specified in the instrument (a Ministerial reliability gap period) that the supply of electricity to all or part of the region may be disrupted to a significant degree (a Ministerial reliability gap) on 1 or more occasions during the Ministerial reliability gap period. (2) Before making a T‑3 reliability instrument under subsection (1), the Minister must consult with AEMO and the AER in relation to the instrument the Minister proposes to make. (3) The regulations under the application Act of a participating jurisdiction (a local regulation) may provide for requirements (including procedures and any methodology) that must be complied with by the Minister in determining whether there is a real risk that the supply of electricity to all or part of a region may be disrupted to a significant degree. (4) A T‑3 reliability instrument under subsection (1) must state— (a) the date on which it takes effect; and (b) the region to which it applies; and (c) the first and last days of the Ministerial reliability gap period; and (d) the trading intervals during the Ministerial reliability gap period for which liable entities may be required to hold net contract positions that are sufficient to meet their share of the one‑in‑two year peak demand forecast for the Ministerial reliability gap period; and (e) AEMO's one‑in‑two year peak demand forecast for the Ministerial reliability gap period. (5) A Minister of a participating jurisdiction may vary or revoke a T‑3 reliability instrument made by the Minister under subsection (1). (6) As soon as practicable after making or varying a T‑3 reliability instrument under this section, the relevant Minister must— (a) publish a copy of the instrument or variation in accordance with any requirements of the local regulations; and (b) publish notice of the making or variation of the instrument in the South Australian Government Gazette. (7) The following provisions apply to a T‑3 reliability instrument under subsection (1): (a) the first day of a Ministerial reliability gap period specified in the instrument under subsection (4)(c) may not be earlier than 3 years after the day on which the instrument is made; (b) despite any other provision of this Part, a T‑3 reliability instrument under subsection (1) that relates to 1 or more days occurring in the period commencing on 1 December 2025 and ending on 31 December 2026 may be made at any time before 1 December 2023. (8) The Minister responsible for administering the application Act (other than the application Act of South Australia) under which a local regulation referred to in this section is made is to make arrangements for notice of the making and publication of the regulation to be published for information in the South Australian Government Gazette. 14K—AER may make reliability instrument for a region (a) AEMO makes a request under section 14I in relation to a forecast reliability gap for a region; and (b) where AEMO's request is for a T‑1 reliability instrument for the region, the AER has made a related T‑3 reliability instrument or the Minister of the participating jurisdiction in which the region is located has made a related T‑3 reliability instrument for the region. (2) The AER must, within the period required by the Rules— (a) consider the request; and (b) decide whether or not to make a reliability instrument for the region in relation to the forecast reliability gap. (3) The AER may decide to make a reliability instrument only— (a) if the AER is satisfied— (i) a forecast reliability gap is forecast, in accordance with the Rules, to occur in the region; and (ii) it is appropriate in the circumstances, having regard to the criteria stated in the Rules, to make the reliability instrument; and (b) for the region, forecast reliability gap period and trading intervals as stated in AEMO's request, without modification. (4) A reliability instrument must state— (a) the information mentioned in section 14I(4)(c), as stated in AEMO's request; and (b) for a T‑1 reliability instrument— (i) the day (the contract position day) on which liable entities are required under section 14R to hold a sufficient net contract position for the reliability gap period; and (ii) the day (the reporting day) on which liable entities must report their net contract position as at the contract position day under section 14P. (5) The reliability instrument takes effect when it is published on the AER's website. (6) The AER must publish its decision to make or refuse to make a reliability instrument, and the reasons for the decision, on the AER's website before— (a) in the case of a T‑3 reliability instrument—the T‑3 cut-off day or an earlier day prescribed by the Rules; or (b) in the case of a T‑1 reliability instrument—the T‑1 cut-off day or an earlier day prescribed by the Rules. (7) If a request made under section 14I was corrected under section 14J, a reference in this section to the request is a reference to the request as corrected. 14L—Reliability instrument has force of law (1) A reliability instrument has the force of law in this jurisdiction. (2) An Act of this jurisdiction regulating the making of subordinate legislation does not apply to a reliability instrument. 14M—Failure to comply with consultation obligation does not affect validity (1) This section applies if the Rules require the AER to undertake stated consultation before making a reliability instrument under section 14K. (2) Failure to comply with the obligation does not invalidate or otherwise affect a reliability instrument. Division 3—Reliability obligations 14N—Application of Division (1) This Division applies to a person if— (a) the AER made a T‑1 reliability instrument for a forecast reliability gap in a region; and (b) the person is a liable entity for the region to which the instrument applies; and (c) the person is a liable entity on— (i) the contract position day; or (ii) in circumstances for which a later day is prescribed by the Rules—the later day. (2) In this Division— (a) a reference to a matter is a reference to the matter for the region to which the T‑1 reliability instrument applies; and (b) a reference to the reliability gap period is a reference to the forecast reliability gap period stated in the T‑1 reliability instrument; and (c) a reference to the stated trading intervals is a reference to the trading intervals stated in the T‑1 reliability instrument; and (d) a reference to the contract position day or the reporting day is a reference to the contract position day or reporting day stated in the T‑1 reliability instrument. 14O—Meaning of qualifying contract and net contract position (1) A qualifying contract of a liable entity is a contract or other arrangement to which the liable entity is a party— (a) that— (i) is directly related to the purchase or sale, or price for the purchase or sale, of electricity from the wholesale exchange during a stated period; and (ii) the liable entity entered into to manage its exposure in relation to the volatility of the spot price; or (b) of another type prescribed by the Rules to be a qualifying contract. (2) However, a qualifying contract does not include a contract or arrangement mentioned in subsection (1)(a) that is prescribed by the Rules to be an excluded contract for the reliability obligations. (3) A liable entity's net contract position during a particular period is— (a) the number of megawatts of electricity to which the liable entity's qualifying contracts under subsection (1) relate for the period; and (b) adjusted in accordance with the Rules to account for the likelihood that, despite the qualifying contracts, the liable entity retains exposure in relation to the volatility of the spot price during the period. spot price means the price for electricity purchased from the wholesale exchange in a region determined in accordance with the Rules. 14P—Obligation to report net contract position (1) The liable entity must give the AER a report about the liable entity's net contract position for the stated trading intervals during the reliability gap period as at the contract position day— (a) that complies with subsection (2); and (b) on or before the reporting day stated in the T‑1 reliability instrument. Subsection (1) is a civil penalty provision: See the definition of "civil penalty provision" in section 2AA(1). (2) The report must— (a) include the information required under the Rules; and (b) be prepared and given in the manner and form required by the Rules. (3) The liable entity must not provide information in a report the liable entity knows is false or misleading in a material particular. Subsection (3) is a civil penalty provision: See the definition of "civil penalty provision" in section 2AA(1). 14Q—Adjustment of net contract position after contract position day A liable entity may adjust the liable entity's net contract position for a stated trading interval during a reliability gap period after the contract position day for the purposes of sections 14R and 14S in accordance with the Rules. 14R—Obligation to have contracted sufficiently for one-in-two year peak demand forecast (1) This section applies if the peak demand is more than the one-in-two year peak demand forecast for the reliability gap period during a stated trading interval in the reliability gap period. (2) The liable entity must comply with the obligation that the liable entity's net contract position for the trading interval is not less than the liable entity's share of the one-in-two year peak demand forecast for the trading interval determined in accordance with the Rules. Subsection (2) is a reliability obligation civil penalty provision: See the definition of "reliability obligation civil penalty provision" in section 2AA(1a). (3) For subsection (2), the liable entity's net contract position for a trading interval is— (a) if the liable entity has adjusted its net contract position under the Rules—the liable entity's net contract position for the trading interval as at the day provided under the Rules; or (b) otherwise—the liable entity's net contract position for the trading interval as at the contract position day. 14S—Obligation to maintain net contract position The Rules may require a liable entity to maintain its net contract position for the stated trading intervals in the reliability gap period during the period that— (a) starts on the contract position day; and (b) ends when the reliability gap period ends.