From a retail perspective, the new market, which integrates AEMO’s roles as both the retail market and wholesale market operator, offers an opportunity for a “more integrated interface to deal with as participants,” says AGL Manager Gas Market Development George Foley.
Mr Foley says that while the market is an ex ante market, there is provision for minimising the impact of deviation charges incurred on a trading day through intraday renominations to the pipeline, — this particular feature of the design recognises the linepack capacities of pipes feeding both the Adelaide and Sydney Hubs.
“This is a useful feature of the market.”
Trading in the new market
AGL has been continuously improving the accuracy of its demand forecasts, which Mr Foley says has “certainly been given a boost by the introduction of the STTM.”
Mr Williams says that “prior to the commencement of the STTM, our gas shipments sourced from our long-term gas supply contract matched our gas usage exactly and although possible, bilateral wholesale gas trades with other parties have been difficult to establish due to lengthy master contract negotiations. The STTM enables a mechanism to easily match sellers who are long term and looking to sell gas at attractive prices to buyers.