Australian Energy Market Operator (AEMO)

On 30 March 2020, the Australian Energy Market Operator (AEMO), on behalf of itself, AEMO Industry Participants and Other Industry Participants lodged an application for authorisation, including requesting urgent interim authorisation, to enable these bodies to discuss, agree to, or engage in any conduct which has the purpose of:

a. Ensuring the safe, secure and/or reliable operation of Australia’s energy systems and/or the continued operation and integrity of the wholesale markets that underpin energy supply during the COVID-19 pandemic.

b. Ensuring ongoing energy supply to support consumers, businesses, government operations and the economy during the pandemic.

c. Minimising the risk of any energy outages during the pandemic.

d. Ensuring that there are sufficient resources to maintain and operate energy infrastructure, including personnel and essential inputs such as fuel, parts equipment; or

e. Planning or preparing for the impacts of the COVID-19 pandemic in relation to any of the above.

On 3 April 2020 the ACCC granted urgent interim authorisation for AEMO to commence some elements of the proposed conduct.

On 17 April 2020 AEMO amended the proposed conduct in its application for authorisation by excluding ‘entering into any contracts, arrangements or understandings in relation to the supply or acquisition of gas in reliance on the proposed authorisation’. On the same day, the ACCC revoked the interim authorisation that it had issued on 3 April 2020 and issued a new interim authorisation which allowed AEMO and energy industry participants to engage in a wider range of conduct (compared to the 3 April interim authorisation), but did not permit sharing information and/or entering into arrangements concerning gas availability.

On 16 July 2020 AEMO further narrowed the scope of the proposed coordination between AEMO and energy industry participants to the categories:

a.    sharing information regarding ongoing operation at their facilities,

b.    co-coordinating repairs and maintenance,

c.    sharing essential personnel, and

d.    sharing essential inputs

and only where these activities are undertaken for one of the purposes summarised listed in the first paragraph above.

On 24 July 2020 the ACCC issued a draft determination proposing to grant conditional authorisation until 31 March 2021. Coinciding with the release of the draft determination, the ACCC revoked the 17 April 2020 interim authorisation and issued a new interim authorisation permitting the narrowed range of conduct that AEMO proposed on 16 July 2020.

On 17 September 2020 the ACCC issued a final determination granting conditional authorisation until 31 May 2021.

Every interim authorisation has been subject to conditions imposing a reporting obligation, a requirement that industry participants continue to comply with reporting obligations for LNG facilities that were the subject of other authorisations, and a requirement that any agreements made under the authorisation cease when authorisation expires or is revoked. These conditions are also imposed in the final determination.

The ACCC’s final determination can be found under the Decisions heading below.

The conditional interim authorisation granted on 24 July 2020 remains in place until this determination comes into effect. If no application for review of the determination is made to the Australian Competition Tribunal, the authorisation will come into effect on 9 October 2020.