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Gas candidates reach last lap

THREE companies shortlisted to operate WA’s gas market when it becomes fully contestable at the end of the year will be invited to submit formal proposals this month.

A final administrative and IT systems support contract will be signed with one of the three – M-co The Market Place Company, VENcorp or Cap Gemini Ernst & Young – by mid-July.

REMCo, the not-for-profit company established by paying industry members to support the setting up and running of fully contestable retail gas markets in both Western Australia and South Australia, is meeting separately with the companies this week to clarify the scope of services required.

REMCo CEO Stephen Thomson said a “representative panel” of REMCo members would decide on the offers and put a recommendation for a prime contractor to the eight-member REMCo board.

One of those shortlisted companies, M-co, is an experienced international energy market operator, with designs on more than WA’s retail gas market.

The company may well be, as claimed, the only independent and non-Government owned electricity operator in the world, but this does not mean it has little knowledge of Government ways.

M-co designed and implemented New Zealand’s wholesale electricity market on behalf of the NZ Government and operates Singapore’s wholesale electricity market, on invitation from that country’s Government.

It is also advising the South African Government on the design of a wholesale electricity market, while operating Australia’s first gas retail market in New South Wales and the Australian Capital Territory, and the Green Electricity Market in Australia.

Aside from its links with Western Power, Metasource and others in the green market, M-co has been visiting WA frequently over the past 18 months, establishing relationships with government and other energy industry players.

M-co marketing director Alastair Walton, a former advisor to NSW Premier Bob Carr, has been here three times in five months.

“You need to build trust, demonstrate high integrity and understand who are the decision makers,” he said.

Mr Walton said M-co’s sponsorship of last week’s Energy in WA conference was an additional opportunity to demonstrate its commitment to energy reform in WA.

M-co was looking at opening a Perth office in the near future to possibly advise on the design and implementation of a new electricity market, if not for involvement with the retail gas market.

It has been putting in the leg-work for this more lucrative opportunity, in December last year, publishing a nine-page paper, Design and Implentation Issues for the Evolving WA Electricity Market – Lessons and Pitfalls.

VENCorp, a Victorian-Government owned, but energy industry-funded entity, operates the Victorian gas transmission network, and Australia’s only wholesale gas spot market.

The not-for-profit entity facilitated the development of data access and transfer rules, and developed and implemented IT systems and a communications hub for Victoria’s fully contestable retail gas market.

VENCorp executive manager energy markets Terry Grimwade said that if the organisation got the go-ahead to operate the WA and SA gas retail markets, this would produce savings within the Victorian market as well.

And the use of similar systems across different States would preclude retailers from having to develop separate interface systems for each market.

Cap Gemini won a competitive National Electricity Market Management Company tender to develop a market settlement and transfer system for the National Electricity Market.

Known as MSATS, the system supported the connection of 100 organisations, 1,000 users and 4.7 million domestic consumers.

The company was unable to provide comment this week on its place on the REMCo shortlist, but the MSATS system is reported to be capable of supporting other forms of energy besides electricity across multiple jurisdictions.

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