The National Electricity Market (NEM)
The National Electricity Market (NEM) is an interconnected grid comprising several connected regional networks and approximately 45,900 MW of installed generation. The NEM spot pool market is operated by AEMO and operates across the eastern states of the mainland, and includes the state grids of (QLD), New South Wales (NSW), Victoria (VIC) and South Australia (SA). Tasmania (TAS) is connected to the other NEM regions via an undersea inter-connector to Victoria. Futures and options contracts are listed on the 4 major regions (VIC, SA, QLD and NSW).
The Wholesale Electricity Market WEM)
The Wholesale Electricity Market (WEM) in WA is part of the South West Interconnected System of Western Australia (SWIS) with approximately 5,798MW of registered generation capacity.
The Market Operator
The (AEMO) Australian energy market operator is responsible for operating both the NEM and the (WEM) markets in accordance with the Wholesale Electricity Market Rules and the related market procedures.
The (AEMC) Australian energy market commission has two roles in relation to the National Electricity Market – as rule maker and as a provider of advice to Ministers on how best to develop energy markets over time. The AEMC actively considers market development when it considers rule change proposals, policy advice and energy market reviews. These rules are binding on the Australian energy market and enforced by the Australian Energy Regulator.
The (AER) Australian energy regulator is the regulator of the wholesale electricity and gas markets in Australia. It is part of the Australian Competition and Consumer Commission and enforces the rules established by the Australian Energy Market Commission.
New Energy Security Board put in place to report to COAG.
On advice from the Finkel Review (the chief scientist) the government have set up a new energy security board which is made up of AEMO, the market operator and AER, the regulator and AEMC the rule maker. This security board will report directly to COAG and the Government.