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2.13 Compliance Monitoring and Enforcement

ERA monitoring of compliance

2.13.1.

The Economic Regulation Authority must monitor other Rule Participants’ behaviour (including AEMO’s and each Network Operator’s behaviour) for compliance with the WEM Rules and WEM Procedures in accordance with the WEM Procedure referred to in clause 2.15.1.

Explantory Notes

Clause 2.13.1 is equivalent to existing clause 2.13.2 and amended to explicitly require the ERA to monitor Network Operators’ behaviour for compliance with the WEM Rules and the WEM Procedures for consistency with the existing approach for AEMO. It is noted that the Network Operator was already covered by the existing clause.

References of this Clause
  • None

2.13.2.

The Economic Regulation Authority must investigate any market behaviour of a Rule Participant if it considers that the behaviour has resulted in the market not functioning effectively.

Explanatory Notes

Clause 2.13.2 is a new clause that contains ERA's obligation to investigate behaviour which results in the market not functioning effectively. It has been moved from clause 2.16.9 to a stand-alone clause to better clarify that monitoring the market for inefficient market outcomes is the ERA’s responsibility.

Clause 2.13.2 will be further reviewed to account for the decisions made in Energy Sector Governance: Proposed Changes to the Regulatory Framework which are proposed to commence on 1 July 2021.

References of this Clause
  • None

2.13.3.

The Economic Regulation Authority must ensure it has processes and systems in place to allow it to monitor Rule Participants’ behaviour (including AEMO’s and each Network Operator’s behaviour) for compliance with the WEM Rules and WEM Procedures in accordance with the WEM Procedure referred to in clause 2.15.1.

Explanatory Notes

Clause 2.13.3 is equivalent to existing clause 2.13.3 and amended for consistency with the drafting approach in other similar clauses.

References of this Clause
  • None

2.13.4.

Without limiting clause 2.13.8, AEMO must co-operate with the Economic Regulation Authority and facilitate any processes and systems put in place by the Economic Regulation Authority under clause 2.13.3, including by providing any market related data, information and document produced or exchanged in accordance with the WEM Rules or WEM Procedures in AEMO’s possession or control that the Economic Regulation Authority has reason to believe may assist the Economic Regulation Authority to monitor Rule Participants’ behaviour (including AEMO’s and each Network Operator’s behaviour) for compliance with the WEM Rules and WEM Procedures.

Explanatory Notes

Clause 2.13.4 is equivalent to existing clause 2.13.3A and is amended for drafting consistency and to clarify that the assistance provided by AEMO under the clause does not limit the further assistance the ERA may request AEMO undertake in accordance with clause 2.13.8.

References of this Clause
  • None

2.13.5.

Each Network Operator must co-operate with the Economic Regulation Authority and facilitate any processes and systems put in place by the Economic Regulation Authority under clause 2.13.3, including by providing any data, information or document in the Network Operator’s possession or control that the Economic Regulation Authority would be entitled to receive under Chapter 10 and has reason to believe may assist the Economic Regulation Authority to monitor the Network Operator's behaviour for compliance with the provisions of the WEM Rules and WEM Procedures.

Explanatory Notes

Clause 2.13.5 is a new clause that requires each Network Operator to co-operate with the ERA, including to facilitate any processes and systems, and provide information to enable the ERA to perform its monitoring and compliance functions on the Network Operator.

References of this Clause
  • None

2.13.6.

The Economic Regulation Authority must disclose the market related data, information or documents provided by AEMO to the Economic Regulation Authority as part of the systems and processes the Economic Regulation Authority must have in place in accordance with clause 2.13.4 as follows:

  1. where AEMO periodically provides market related data, information or documents as part of the systems and processes in place under clause 2.13.4, publishing the types of market related data, information or documents provided on the Economic Regulation Authority’s website in as much detail as the Economic Regulation Authority considers is reasonably practicable;

  2. where the Economic Regulation Authority requests AEMO to provide the Economic Regulation Authority with market related data, information or documents in accordance with clause 2.13.4 and the market related data, information or documents:

    1. is not one of the types disclosed under clause 2.13.6(a); and

    2. relate to a specific Rule Participant (or group of Rule Participants), then the Economic Regulation Authority must notify that Rule Participant (or group of Rule Participants).

Explanatory Notes

Clause 2.13.6 is equivalent to existing clause 2.13.3B and is amended to update clause references.

References of this Clause
  • None

AEMO monitoring of compliance

2.13.7

AEMO must, in accordance with the WEM Procedure referred to in clause 2.15.4:

  1. monitor Rule Participant’s behaviour for compliance with section 7.10;

  2. monitor Rule Participant’s behaviour for compliance with the WEM Procedure referred to in clause 2.29.9A;

  3. ensure it has processes and systems in place to allow it to monitor Rule Participant's behaviour in accordance with clause 2.13.7(a) and clause 2.13.7 (b), including developing systems for monitoring;

  4. support the Economic Regulation Authority's monitoring of Rule Participants’ behaviour, including having processes and systems to provide the Economic Regulation Authority with data, information, documents or analysis under clauses 2.13.4, 2.13.7, 2.13.8(a), 2.13.8(b) or 2.13.14, as applicable; and

  5. subject to clause 2.13.12, record the alleged breach of the WEM Rules or WEM Procedures and report any alleged breaches resulting from its monitoring under clause 2.13.7(a) and clause 2.13.7(b) to the Economic Regulation Authority.

Explanatory Notes

Clause 2.13.7 is equivalent to existing clause 2.13.6, and clause 2.13.9 is amended to incorporate the existing clauses 2.13.9A and 2.13.9B and to outline AEMO’s obligation to monitor Rule Participants’ behaviour with: - specific clauses of the WEM Rules that will be listed at a later date when the remaining rules have been drafted; and - specific WEM Procedures that will be added to this clause as they become apparent. The intent is that AEMO will actively monitor Rule Participants’ behaviour for compliance against the specified WEM Rules and WEM procedures. For other rules and procedures, AEMO may become aware of a suspected breach through its usual market and system operation activities. The clause will be reviewed further to insert specific WEM Rule provisions and WEM Procedures that AEMO must actively monitor. Consultation on clause 2.13.7 will be conducted in a subsequent tranche of draft Amending Rules.

References of this Clause
  • None

2.13.8.

Where the Economic Regulation Authority has reason to believe AEMO may be able to assist it to monitor Rule Participants’ behaviour (including each Network Operator’s behaviour) for compliance with the WEM Rules and WEM Procedures, it may request AEMO to:

  1. undertake analysis of any market related data, information and document produced or exchanged under clause 2.13.4; or

  2. provide any specific market related data, information and document produced or exchanged in accordance with the WEM Rules or WEM p rocedures in AEMO’s possession or control not provided by AEMO to the Economic Regulation Authority under clause 2.13.4, to assist to monitor a Rule Participant's compliance with a specific obligation or requirement. For the avoidance of doubt, the Economic Regulation Authority is not permitted to delegate the monitoring of Rule Participant behaviour to AEMO.

Explanatory Notes

Clause 2.13.8 is a new clause that allows the ERA to request AEMO to provide further information, or undertake specific analysis to assist it to monitor Rule Participants’ behaviour for compliance with the WEM Rules and WEM Procedures.

References of this Clause
  • None

2.13.9.

AEMO must comply with a request by the Economic Regulation Authority under clause 2.13.8 by the time specified in the request, which must be a reasonable time having regard to the nature of the request, or such alternative time as mutually agreed.

Explanatory Notes

Clause 2.13.9 is a new clause that requires AEMO to comply with a request by the ERA under new clause 2.13.8.

References of this Clause
  • None

2.13.10.

Subject to clause 2.13.7(b), AEMO is not required to monitor a Network Operator’s behaviour for compliance with the WEM Procedures developed by the Network Operator.

Explanatory Notes

Clause 2.13.10 is a new clause that clarifies that AEMO is not required to monitor Network Operators’ compliance with any WEM Procedures developed by the Network Operator. In accordance with clause 2.13.23, a Network Operator must self-report its own breaches, or suspected breaches, of any WEM Rules or WEM Procedures developed by it.

References of this Clause
  • None

2.13.11.

Where a Registered Facility operates within the Tolerance Range or Facility Tolerance Range applicable to the Registered Facility during a Dispatch Interval, any deviation is not considered to be a breach of clause 7.10.1 or of a provision of section 3.21 by reason of the deviation only.

Explanatory Notes

Clause 2.13.11 is a new clause that reflects the policy intent that any deviations by a Registered Facility within the Tolerance Range or Facility Tolerance Range applicable to the Registered Facility will not be considered to be non-compliant with the relevant Dispatch Instruction.

References of this Clause
  • None

2.13.12.

AEMO is not required to report to the Economic Regulation Authority an alleged breach by a Rule Participant of:

  1. section 3.21 if the alleged breach is limited to occurring within a single Trading Interval and the extend of the alleged breach is either within the Tolerance Range of the Facility Tolerance Range for that Facility; or

  2. section 7.10 if the alleged breach does not exceed six consecutive Dispatch Intervals unless the alleged breach is considered by AEMO, in its reasonable opinion, to be material or likely to impact Power System Security or Power System Reliability.

Explanatory Notes

Clause 2.13.12 is equivalent to existing clause 2.13.6B and is amended to reflect when AEMO is not required to report alleged breaches to the ERA.

References of this Clause
  • None

2.13.13.

Subject to clause 2.13.11, nothing in clause 2.13.12 relieves:

  1. AEMO from its obligation to monitor Rule Participants’ compliance in accordance with clause 2.13.7(a) and clause 2.13.7(b); or

  2. Rule Participants from the obligation to fully comply with the WEM Rules and the WEM Procedures, regardless of whether AEMO is required under the WEM Rules to report any alleged breach to the Economic Regulation Authority.

Explanatory Notes

Clause 2.13.13(a) ensures that even where AEMO is not required to report an alleged breach under clause 2.13.12, AEMO is not relieved of its obligation to monitor Rule Participants’ compliance with the WEM Rules and WEM Procedures specified in clause 2.13.7. Clause 2.13.13(c) ensures Rule Participants are not relieved from their obligation to comply with WEM Rules and WEM Procedures regardless of whether AEMO is required to report an alleged breach to the ERA.

References of this Clause
  • None

2.13.14.

AEMO may, but is not required to, notify the Economic Regulation Authority of any alleged breach under clause 2.13.7 or clause 2.13.15 where the Economic Regulation Authority is in possession or control of any market related data, information or other documents or analysis that allows the Economic Regulation Authority to identify an alleged breach of the WEM Rules or WEM Procedures.

Explanatory Notes

Clause 2.13.14 is a new clause that sets out when AEMO is not required to notify the ERA of breaches. Situations where AEMO considers it does not need to notify the ERA will be set out in the AEMO WEM Procedure under 2.15.4.

References of this Clause
  • None

2.13.15.

Except where clause 2.13.14 applies, where AEMO becomes aware of an alleged breach of the WEM Rules (other than a provision of the WEM Rules referred to in clause 2.13.7) or the WEM Procedures developed by AEMO then it must notify the Economic Regulation Authority in accordance with the WEM Procedure referred to in clause 2.15.4.

Explanatory Notes

Clause 2.13.15 is equivalent to existing clause 2.13.9C and is amended to refer to AEMO’s requirement to report alleged breaches to the ERA being subject to clause 2.13.14, which does not require AEMO to report alleged breaches that the ERA should already be aware of. This is to avoid unnecessary duplication of notifications to the ERA. AEMO will be required to outline in the WEM Procedure the situations where ERA would already be aware of an alleged breach and therefore notification by AEMO will not be required. The clause also incorporates the changes in relation to Generator Performance Standards which will follow 3A processes. Please note that even though the ERA may have notice of the alleged breach though data collection or other means, AEMO is still required to notify the ERA of all alleged breaches that relate to power system security and reliability.

References of this Clause
  • None