Fees and Charges

Registration Fees

Under the Market Rules, fees are charged for registration of Participants and Facilities. The fees for registration (and other sundry matters) can be found here.

Information to be released on application

Under Market Rule 10.4, the IMO may charge a fee for provision of information, where that information is requested from the IMO.

Upon receiving a request for information under this Market Rule, the IMO will advise the relevant Participant of the fee for this service based on an estimate of the time required and an hourly charge.

Market Fees for 2012/13

The IMO is required to charge Market Fees in accordance with clause 2.24 of the Market Rules to recover the costs of:

the IMO;
System Management's wholesale market related functions; and
Economic Regulatory Authority's wholesale market related functions.

Market Rule 2.24.2 requires that the IMO publish, before June 30 each year, the level of Market Fee rate for the coming financial year.

The Market Fee rate for 2012/13 has been set at $0.756/MWh.

This fee will apply to all energy, including that sold/bought under bilateral contracts, from 1 July 2012.

In accordance with clause 9.13.1 of the Market Rules, the fee rate is based on spreading the total required revenue over both the total generation and the total consumption of electricity in the market.

There are two main variables in setting Market Fees. These are:

Target Revenue (or budget) which needs to be set to adequately cater for the costs of the IMO, System Management and the ERA; and
Forecast energy supply/consumption.

Revenue to be Recovered through Market Fees for 2012/13

The total revenue to be recovered through Market Fees is expected to be as follows:

Total Revenue 2012/13	(000)
IMO Revenue Requirement	15,537
SM Revenue Requirement	9,767
ERA Revenue Requirement	1,469
Total Revenue to be Recovered through Market Fees	26,773

IMO 2012/13 Budget

Prior to 30 April 2012, the IMO submitted to the Minister its budget proposal for 2012/13 as part of its Operational Plan.

The 2012/13 budget was consistent with the Allowable Revenue approved by the ERA.

A revenue target of $15.537 million has been approved to be recovered from Market Participants through Market Fees during 2012/13.

The breakdown of this budget into Market Operation, System Planning and Market Administration must be published with the publication of the Market Fee rate. This is as follows:

Revenue Requirement 2012/13	(000)
Market Operation	8,779
Market Administration	4,521
System Planning	2,237
TOTAL REVENUE REQUIREMENT	15,537

System Management 2012/13 Budget

System Management's budget for 2012/13 of $9.767 million, which is consistent with the Allowable Revenue approved by the ERA, is to be recovered from Market Participant fees.

ERA 2012/13 Budget

The ERA Wholesale Electricity Market related costs of $1.469 million, as approved by the Government, are to be recovered from Market Participant fees.

Forecast Energy Supply/Consumption

Forecasts prepared for the 2013 Statement of Opportunity (SOO) are the latest available assessment of energy forecast supply/consumption figures going forward – this “expected” energy forecast is used as the basis for calculating 2012/13 Market Fees.

The 2012 SOO “expected” forecast of sent-out energy in 2012/13 is 17,585 GWh. This is down from 19,088GWh that was used in setting the Fee Rate for the previous year (7.9% reduction). There are some notable factors contributing to the reduction:

Reason for Reduction	GWH Reduction	% Reduction on LF
The impact of PV’s load forecast is taken into account for the first time and is estimated to reduce load by 327 GWH.	-327	-1.7%
The impact of block loads is forecast to reduce load by 594 GWh, primarily due to revised demand requirements from the Karara and Simcoa sites. Additionally, the Boddington site’s demand has plateaued compared to an earlier forecast of an increase in demand.	-594	-3.1%
Modelled impact of price increases (e.g. impact of carbon price) is forecast to reduce load by 219 GWh.	-219	-1.1%
Year on Year Change is estimated to reduce load by 362 GWh.	-362	-1.9%
Total	-1,502	-7.9%

In accordance with the Market Rules, the SOO sent-out forecasts must be loss-adjusted to the Muja reference for use in calculating the actual monthly Market Fees. An average (generation) loss factor of 1.006931712 (average for the 2010/11 Reserve Capacity Year) has been used to loss-adjust the SOO sent-out figure to the Muja reference node. This results in energy forecast supply/consumption figure of 17,706 GWh.

Under the Market Rules the fee rates are based on spreading the total required revenue over both the total generation and the total consumption of electricity in the market. This incorporates all energy, including that sold/bought under bilateral contracts.

The “expected” energy forecast, therefore, is effectively doubled to apply Market Fees equally across Market Generators and Market Customers. This results in an amount of 35,413 GWh over which all targeted revenue is spread to calculate a Market Fee rate.

Breakdown of Market Fees for 2012/13

The Market Fee rate is structured in three parts to provide transparency of fee rates related to the IMO, System Management and the ERA.

Spreading the total revenue requirement over the projected energy supply and consumption of 35,412 GWh in 2012/13 produces the following fee rates:

Fee Type	Fee Rate $/MWh
IMO Fee Rate*	0.439
System Management Fee Rate	0.276
Economic Regulation Authority Fee Rate	0.041
Total Market Fee Rate	0.756

* The IMO fee rate is influenced by the impact of the Market Evolution Program fee rate of $0.118/MWh.

This document is published in accordance with Market Rule 10.5.1 (u).