Facility operators will be responsible for classifying a service as a transitional firm service if they meet the criteria set out in the Rules and must notify the AER if they intend to do so no later than 30 business days before the classification takes effect.
The AER may require a facility operator to procure and provide an independent expert opinion on the transitional firm service classification addressed to the AER and on which the AER may rely. The independent expert opinion must address all matters and provide all supporting material referred to in the Rules. The required material includes a copy of the agreement or agreements containing the terms and conditions on which the transportation service is provided (including any amendments) and the application must contain an assessment of the transportation service against the criterion in the rules. The AER may also reasonably require other information or documentation.
Upon application, If the AER is not satisfied a service meets the TFSR criteria it may reject the classification, otherwise the TFSR become effective for use 30 business days after application through registration processes with AEMO. The AER, however, may revoke the classification at a later point if it is not satisfied that the criteria above are met.
In general terms transportation services that meet the following criteria can be treated as ‘transitional firm’ services for the purpose of the auction priority principles and therefore rank ahead of the action product.
- the transportation service is currently treated as firm once scheduled;
- the transportation service is used for the supply of gas for consumption by a gas-fired generator that is a market generating unit;
- at least one of the service points is either a point at which gas is supplied for consumption by a market generating unit, or is on another transportation facility that is used to receive gas for onward transportation to a market generating unit; and
- the terms and conditions for use of the transportation service are set out in a primary facility agreement made on or before 19 March 2018 and are the same, or substantially the same, as the terms and conditions in force on that date.
In accordance with the Rules, any information provided to the AER in relation to the classification of transitional firm services will be taken to have been provided to the AER in confidence.