AER institutes proceedings against Queensland generator Stanwell

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Release date: 
28 July 2009
Overview:

On 28 July, the Australian Energy Regulator instituted proceedings in the Federal Court against Stanwell Corporation Limited for alleged contraventions of the National Electricity Rules. Stanwell is a Queensland Government owned electricity generator.

The AER alleged that Stanwell did not make several of its offers to generate electricity on 22 and 23 February 2008 in 'good faith' contrary to clause 3.8.22A of the National Electricity Rules. The proceedings arose from the AER's report into the sustained high electricity prices in Queensland on February 22-23 2008. Generators like Stanwell are required to offer to supply energy into the National Electricity Market in good faith. The Australian Energy Market Operator accepts offers from generators and dispatches those generators in order of least cost to meet demand. Rebidding allows generators to alter these offers in response to changes in circumstances. The good faith provision of the National Electricity Rules requires a generator to honour its offer to the market unless there is a change in the material conditions upon which the offer was based. Rebids that are not made in good faith can adversely affect the accuracy of information upon which market participants rely.

The AER sought orders including declarations, civil penalties, a compliance program, and costs. The hearing commenced in June 2010.

Outcome: 

On 30 August 2011, the Federal Court dismissed the AER’s case regarding Queensland generator Stanwell Corporation Limited in relation to alleged breaches of the National Electricity Rules. A copy of the decision is available through the Australasian Legal Information Institute database.