Cash Security
Background
On 26 June 2025, the Australian Energy Market Commission (AEMC) published the final and more preferable rule ‘Allowing AEMO to accept cash as credit support’, to amend the credit support arrangements to increase flexibility for participants that provide credit support in the National Electricity Market (NEM). The changes are anticipated to, in particular, benefit small and prospective retailers.
AEMO has established the Cash Security project under the NEM Reform Program to carry out the procedure and system changes arising from the rule and to support industry readiness for the changes.
Scope and timeline
From 1 November 2026, the rule introduces the ability for participants to opt-in to use cash as credit support up to a limit of $20 million per participant (CPI-indexed). This is the main implementation component.
Minor efficiencies and protections in prudential framework are also introduced, with minor implementation requirements. This includes strengthened protections against clawback claims, and a bringing forward of settlement repayment in the event of late credit support being received from a participant.
| Timing | Element |
|---|---|
|
Thursday 26 June 2025 |
Final determination |
|
3 months prior to rule commencement |
Publication of Cash security guidelines |
|
Sunday 1 November 2026 |
Rule commencement |
High-Level Implementation Assessment (HLIA)
AEMO anticipates publishing an updated HLIA to reflect the scope of the final rule in August 2025 (TBC). Ongoing stakeholder feedback on AEMO's draft HLIA is welcome via email to NEMReform@aemo.com.au.
AEMO hosted a stakeholder forum on 9 May to discuss the draft HLIA. A copy of the presentation is available here:
Industry engagement
This initiative forms part of NEM Reform Program and market participants can get involved by visiting: