Electricity market participants
A wide variety of people, businesses and organisations participate in the two electricity markets operated by AEMO. The roles played by these participants – from generation to purchasing – are classified as specific ‘participant categories’, which reflect the registration requirements, responsibilities and functions of each type of participant.
National Electricity Market (NEM) participant categories
The National Electricity Market (NEM) operates in Australia’s eastern and south-eastern states and has a number of Registered Participant categories that – in certain cases – are broken down further into different classifications. Participants may be registered in more than one Registered Participant category.
Any person who owns, controls or operates a generating system connected to a transmission or distribution network must register as a generator, except where they meet the exemption criteria.
Each of the generator’s registered generating units must be classified as market or non-market depending if the sent-out electricity is sold through the spot market and classified as scheduled, non-scheduled or semi-scheduled depending on how the generating unit participants in central dispatch.
Small Generation Aggregator (SGA)
An SGA can supply electricity aggregated from one or more small generating units, which are connected to a distribution or transmission network. A small generating unit is owned, controlled and/or operated by a person who AEMO has exempted from the requirement to register as a generator. The only SGA registration category is a market small generation aggregator.
A customer is a registered participant that purchases electricity supplied through a transmission or distribution system to a connection point. Retailers and end users who buy electricity in the spot market must be registered as market customers.
Network Service Provider (NSP) - including Special Participant
A person who owns, operates or controls a transmission or distribution system must register with AEMO as an NSP. The Australian Energy Regulator may exempt a person from registering as an NSP if the person meets specific criteria or if they are appointing an intermediary.
When registering, NSPs must categorise each of their network systems as either a transmission system or distribution system. NSPs either earn revenue from a regulated income or from the spot market. The latter must register as market NSPs and classify their services as scheduled network services. Market NSPs must participate in AEMO’s central dispatch process.
Anyone that wishes to participate in a reallocation transaction must register as a reallocator. A reallocator must be a “wholesale client” as defined in the
Corporations Act 2001 (Cth).
A reallocation transaction is undertaken with the consent of two market participants and AEMO. AEMO credits one market participant with a positive trading amount for a trading interval, and debits a matching negative trading amount to the other market participant for the same trading interval. These may be specified dollar amounts, or calculated by reference to a specified quantity of energy and price. These amounts are typically underpinned by a contract between the credit and debit parties, but AEMO is not a party to that contract.
Anyone who wants to take part in a Settlements Residue Auction (SRA), and is not already registered as a customer or generator, must register as a trader.
A metering coordinator is a Registered Participant with the overall responsibility for coordination and provision of metering services at a connection point in the NEM.
Demand Response Service Provider
A Demand Response Service Provider (DRSP) delivers:
- market ancillary services in accordance with the National Electricity Rules and AEMO’s market ancillary services specifications, by offering a customer’s load, or an aggregation of loads into FCAS markets.
- wholesale demand response in accordance with the National Electricity Rules and the Wholesale Demand Response Guidelines by allowing large customers to enter into a contract with a DRSP to provide demand response by reducing load.
A DRSP need not be the customer’s retailer. In practice, this may mean that while a customer has a retail supply contract with a retailer, a customer may also have a separate contract with a DRSP to provide ancillary services or wholesale demand response.
A person may apply for registration as an intending participant if they can reasonably satisfy AEMO that they intend to commence activities that require them to be a registered participant.
Wholesale Electricity Market (WEM) participant categories
The Wholesale Electricity Market (WEM) in Western Australia uses ‘Rule Participant classes’ that categorise the role the person or business plays in the market and the rules that apply to them. A Rule Participant can belong to more than one class, except where this is explicitly restricted.
Anyone who owns, controls or operates a generating facility that’s connected to the South West Interconnected System (SWIS) is a Market Generator, although registration is optional in some instances.
Anyone who is intending to own, control or operate a generator, but is not ready to participate in the market, can also register as a Rule Participant.
A participant that sells, or intends to sell, electricity to customers is a Market Customer, although there are some exemptions to the requirement to register.
Anyone who owns, controls or operates a transmission or distribution network in the SWIS is a Network Operator, although some exemptions apply.
Anyone who is intending to own, control or operate a transmission or distribution network, but is not ready to participate in the market, can also register as a Rule Participant.
Ancillary Service Provider
Generators that wish to provide load following ancillary services (LFAS) – which help AEMO to regulate system frequency – and other ancillary services must also register as an Ancillary Service Provider.