The STTM is vital to the southeastern Australian energy sector, improving efficiency and competition across the gas sector in the states of New South Wales and South Australia, AEMO Managing Director and Chief Executive Officer Matt Zema said in a statement.
"It will introduce transparency of terms, prices and quantities," Zema said. "It is timely that the market is being introduced, at a time when new gas sources are entering the market, supporting the increased efficiency which the market offers."
The AEMO, a collaboration of six industry bodies from the electricity and gas markets, was established by the Council of Australian Governments and developed under the guidance of the Ministerial Council on Energy. It is owned 60% by government members and 40% by industry members.
Zema said the AEMO had managed the implementation of the STTM, but it was undertaken with the cooperation of industry participants. "It should be noted that approval to establish the STTM was given by the Ministerial Council on Energy in August 2008 but consultations on modelling and other aspects of the market have been ongoing since 2004," he added.
The hub-based market will be administered by AEMO and initially operate in Sydney and Adelaide, with the potential to expand in the future.
South Australian state Energy Minister Patrick Conlon welcomed the establishment of the STTM. "Given South Australia is leading the way with cleaner energy sources, having 907 MW of installed wind capacity and another 243 MW under construction, gas-fired generation is an increasingly important part of the energy supply chain and the STTM will help South Australia continue to do its part for the environment," he said in a statement.
Conlon said consumers would not notice any change in their gas supply arrangements, but were likely to enjoy flow-on benefits.
"Short-term trading between market participants provides greater flexibility to respond to changes in supply and demand, which in turn improves reliability of supply," he said. "The STTM is also expected to improve gas trading by introducing greater transparency of terms, prices and quantities,
as well as more real time information on the state of the gas market. This in turn will help ensure timely provision of gas infrastructure."
The STTM also integrates demand into the market, known as contingency gas, to assist in managing potential gas supply shortfalls and increasing supply reliability by paying parties for additional gas during periods of scarcity, Conlon said.
China Chemical Weekly: http://news.chemnet.com/en/detail-1411716.html
