AEMO has activated the Gas Supply Guarantee mechanism to secure gas supplies from Queensland-based gas producers to support gas-powered electricity generation in the National Electricity Market (NEM).
Challenging generation conditions experienced from the onset of winter continue in the NEM. This has resulted in a greater reliance on gas-powered generation and larger inventory reduction at the Iona gas storage facility in Victoria.
In response, AEMO has issued two ‘threat to system security notifications’ (11 July and 18 July) to reduce the depletion rates at Iona.
An initial request was made for participants to cease purchasing gas from Victoria’s Domestic Wholesale Gas Market (DWGM) for supply to other jurisdictions. The second request was to cease purchases for Victorian electricity generation.
Market participants are responding to AEMO’s requests and directions to maintain a secure operating state for Victoria’s gas system.
At this stage, there is no impact to gas supply in Victoria.
AEMO expects the gas supply guarantee and threat to system security mechanisms to remain in effect until 30 September 2022 or until gas supplies are sufficient.