RETAIL Energy Market Company Limited (REMCo), the company established to oversee a fully contestable gas market across WA and South Australia, is close to announcing its officers. Western Australian gas retailer, network operator and soon-to-be generator
RETAIL Energy Market Company Limited (REMCo), the company established to oversee a fully contestable gas market across WA and South Australia, is close to announcing its officers.
Western Australian gas retailer, network operator and soon-to-be generator, Alinta-Gas, has two directors on REMCo’s board – general manager networks Ian Devenish and general manager sales Donald MacKenzie.
Led by a board of eight representatives from across the market spectrum, one of REMCo’s first functions, apart from drafting retail market rules, is to produce a functional IT systems and services specification prior to putting this out to tender.
Efficient and effective data systems will be the key to the successful operation of the market, including customer transfer.
The establishment of REMCo to oversee the retail gas markets across SA and WA will deliver economies of scale that will attract more competitors, deliver better cost savings to participants and ultimately result in lower prices to consumers than if the two States were to individually establish full retail contestability within comparatively small markets.
REMCo – established by market participants through WA’s Gas Retail Deregulation Project Steering Group and SA’s Full Retail Contestability Industry Working Group – was registered with the Australian Securities and Investment Commission last week.
GRDP steering group chairman Richard Harris said the function of REMCo was similar to that of the Gas Market Company in New South Wales and VENcorp in Victoria.
The directors were elected from incumbent retailers, such as Origin Energy and AlintaGas, new entrant retailers including AGL and TXU, and network operators.
An AlintaGas spokesperson confirmed the utility was looking forward to full competition – planned for WA by year’s end – and for SA by early 2004 – and welcomed the establishment of REMCo as the market operator.
Origin Energy, which has commercial contracts with large consumers within WA, and has 350,000 retail customers in SA, said some customer transfer that was legal now was not yet practical, until customer processes were put in place.
ACIL Tasman executive director WA & NT Ian Satchwell described the joint Western Australian and South Australian markets as an innovative approach that would achieve a fully competitive market at a reasonable cost.
“The whole idea behind energy market reform is to provide vigorous competition, which provides choice to customers, the key to lower prices,” Mr Satchwell said.
“But the barriers to truly competitive markets are usually the high cost of the systems and market administration needed to make sure the market operates fairly and as intended.
“The establishment of REMCo will ensure WA and SA reap the benefits of competition sooner, and at a lower cost.”
Members of WA’s GRDP Steering Group include AGL, AlintaGas, Apache Energy, the Chamber of Commerce and Industry WA, CMS Energy, Epic Energy, Kleenheat Gas, Origin Energy, and various government departments.
