The AER has commenced consultation on the revised interim Contracts and Firmness (C&F Guidelines) for the Retailer Reliability Obligation (RRO).
The purpose of the RRO is to support reliability in the National Electricity Market (NEM). The C&F Guidelines are one of 5 guidelines that set out the AER’s roles and responsibilities in relation to the RRO.
As part of the RRO, liable entities (entities subject to the RRO) are required to enter into sufficient qualifying contracts to meet their share of the Australian Energy Market Operator’s (AEMO’s) one-in-two year peak demand forecast during a forecast reliability gap period. Liable entities are required to report on their Net Contract Position (NCP) to the AER.
The C&F Guidelines set out the AER's approach to:
- information requirements for liable entities
- qualifying contracts
- contract firmness methodology
- the treatment of non-standard qualifying contracts
- the NCP reporting process, and
- the reporting requirements for AEMO (including compliance trading intervals and compliance reports).
The focus of this consultation is to update the C&F Guidelines to address the Retailer reliability obligation exemption for scheduled bi-directional units rule. The consultation process will have the following stages:
- consultation on the proposed draft of the C&F Guidelines, which commences on 10 June 2025 and closes on 8 July 2025.
- a stakeholder forum on 17 June 2025.
- we anticipate publishing a final decision in August 2025.
In 2026, the AER will conduct a broader review of the C&F Guidelines. We expect that the Reliability Instrument Guidelines and Market Liquidity Obligation Guidelines will also be updated together with the C&F Guidelines.
While we are primarily seeking feedback on the changes made to address Retailer reliability obligation exemption for scheduled bi-directional units rule in this draft decision consultation, the AER welcomes advance views on the planned broader 2026 review of the C&F Guidelines. Issues raised in relation to other aspects of the C&F Guidelines will be addressed fully in the broader consultation in 2026.