AEMC draft determination, about ‘Allowing AEMO to accept cash as credit support’

We’d previously written:

• on 8th October 2024, about how ‘Delta Electricity submits ‘relatively urgent’ Rule Change Proposal for December 2024 credit support deadline’; and then
• on 21st November 2024, about how ‘Delta’s ‘relatively urgent’ Rule Change reverts to the (slower) ‘standard rules consultation process’ at the AEMC’.

… so thought it was worth (belatedly) noting that …

1)  AEMC makes draft determination (supporting cash as credit support)

On Thursday 3 April 2025 (a little over 2 weeks ago), the AEMC made a draft determination on this matter:

Two key points:

1)  The AEMC has decided to make a ‘more preferable draft rule’ … noting (p3/63):

‘The draft rule would amend the credit support arrangements in the National Electricity Market (NEM) to increase optionality and flexibility for market participants to provide credit support and meet their prudential requirements, without weakening the credit support arrangements. It would achieve this by:

• allowing participants to provide cash as credit support up to a limit of $5 million each

• allowing participants to provide surety bonds as credit support

• broadening the pool of acceptable credit support providers’

… and includes this image as Figure 1.1 (p11/63):

2)  The AEMC are seeking stakeholder feedback by 15 May 2025.

There’s more details about ERC0403 on the AEMC Rule Change sub-site here.

2)  Vales Point has continued to operate into 2025

I don’t have specific knowledge of what’s been done in 2025 ytd in terms of credit support for the station (given concerns were raised in late 2024), but worth noting that Vales Point has continued to operate in 2025.

Hopefully obvious to readers that (should this have not been the case) we would have noted otherwise earlier in the year.