Maximum Reserve Capacity Price
Each year the IMO is required to conduct a review of the Maximum Reserve Capacity Price that sets the cap for the Reserve Capacity Auction. The general steps in this process are:
- IMO conducts a review of the Maximum Reserve Capacity Price and produces a Draft Report.
- The IMO publishes the Draft Report and requests submissions from the public on the review.
- The IMO reviews all submissions made and revises the Maximum Reserve Capacity Price if appropriate.
- The IMO provides a final report which is submitted to the Economic Regulation Authority (ERA) for approval.
- Following approval or further review, the IMO publishes the approved Maximum Reserve Capacity Price.
For the first Reserve Capacity Cycle, the Maximum Reserve Capacity Price was set at $150,000 per MW per year. This Maximum Reserve Capacity Price applied from Energy Market Commencement to 1 October 2008.
Reserve Capacity Prices
The following table details the Reserve Capacity Price effective in the Market. The Reserve Capacity Price is the price paid by the IMO for Capacity Credits not traded bilaterally between Participants.
| Period | Price per MW per year | Price per MW per month |
|---|---|---|
| 21/09/06 - 01/10/06 | $127,500.00 | $10,625.00 |
| 01/10/06 - 01/10/07 | $127,500.00 | $10,625.00 |
| 01/10/07 - 01/10/08 | $127,500.00 | $10,625.00 |
| 01/10/08 - 01/10/09 | $97,834.92 | $8,152.91 |
| 01/10/09 - 01/10/10 | $108,458.57 | $9,038.21 |
| 01/10/10 - 01/10/11 | $144,235.38 | $12,019.62 |
| 01/10/11 - 01/10/12 | $131,804.58 | $10,983.72 |
2010 Maximum Reserve Capacity Price
The IMO has completed the Maximum Reserve Capacity Price review for the 2010 Reserve Capacity Cycle which requires capacity to be available from 1 October 2012 through to 1 October 2013.
The IMO proposed a final revised value for the Maximum Reserve Capacity Price of $238,500 per MW per year to the ERA. This value was approved by the ERA on 29 January 2010 in accordance with clause 2.26 of the Market Rules. The Maximum Reserve Capacity Price of $238,500 per MW per year will be effective from 1 October 2012 to 1 October 2013.
Copies of the various relevant documents can be found below.
Final Report
Draft Report
Applicable Documents
ERA Approval Notice [214kB]
GHD Fixed Fuel Costs [736kB]
Landgate Land Costs [1.6MB]
The following submissions were received by the IMO:
Alinta Submission [1.8MB]
Griffin Energy Submission [58kB]
Perth Energy Submission [3.2MB]
Synergy Submission [1.2MB]
Tesla Corporation Submission [159kB]
2009 Maximum Reserve Capacity Price
The IMO has completed the Maximum Reserve Capacity Price review for the 2009 Reserve Capacity Cycle which requires capacity to be available from 1 October 2011 through to 1 October 2012.
The IMO proposed a final revised value for the Maximum Reserve Capacity Price of $164,100 per MW per year to the ERA. This value was approved by the ERA on 19 January 2009 in accordance with clause 2.26 of the Market Rules. The Maximum Reserve Capacity Price of $164,100.00 per MW per year will be effective from 1 October 2011 to 1 October 2012.
Copies of the various relevant documents can be found below.
ERA Approval Notice [212kB]
Landgate Market assessment for hypothetical land sites suitable for the development of a power plant [188kB]
The following submissions were received by the IMO:
2008 Maximum Reserve Capacity Price
The IMO has completed the Maximum Reserve Capacity Price review for the 2008 Reserve Capacity Cycle which requires capacity to be available from 1 October 2010 through to 1 October 2011.
The IMO proposed a final revised value for the Maximum Reserve Capacity Price of $173,400.00 per MW per year to the ERA. This value was approved by the ERA on 15 January 2007 in accordance with clause 2.26 of the Market Rules. The Maximum Reserve Capacity Price of $173,400.00 per MW per year will be effective from 1 October 2010 to 1 October 2011.
Copies of the various relevant documents can be found below.
ERA Approval Notice [48kB]
2007 Maximum Reserve Capacity Price
Following the review of the Maximum Reserve Capacity Price initiated in 2006 the IMO proposed a Maximum Reserve Capacity Price of 129,900 per MW per year for the 2009/10 Reserve Capacity Year. After the public consultation process, this value was revised by the IMO to $142,200 per MW per year. The IMO proposed this revised value in its Final Report to the ERA for approval in accordance with Market Rule 4.16.7.
On 30 January 2007, the ERA approved the value of $142,200 per MW per year for the Maximum Reserve Capacity Price in accordance with clause 2.26 of the Market Rules. This Maximum Reserve Capacity Price will be effective from 1 October 2009 to 1 October 2010.
Copies of the various relevant documents can be found below.
ERA Approval Notice [56kB]
These reports are published in accordance with Market Rule 4.16.6.
The following submissions were received by the IMO:
Submission from Alinta Sales [195kB]
Submission from Eneabba Gas [180kB]
2006 Maximum Reserve Capacity Price
In 2005/06, the IMO completed a review of the Maximum Reserve Capacity Price for the period between 1 October 2008 and 1 October 2009. Following the review process and public consultation, a final revised Maximum Reserve Capacity Price of $122,500 per MW per year was proposed to the Economic Regulation Authority. This value was accepted by the ERA on 23 January 2006.
Copies of the various relevant documents can be found below.
ERA Approval [43kB]
Changes to the Reserve Capacity Pricing Mechanism
On 18 August 2006, the Minister for Energy approved a change to the Market Rules whereby the Reserve Capacity Price will be reduced in proportion to any excess of credits acquired by the IMO. This applies from 1 October 2008. Details of the change can be found below.