Summary and key recommendations

 There is clearly an issue with market concentration and market power in the National Electricity Market (NEM). IThe measures proposed in the Treasury Laws Amendment (Prohibiting Energy Market Misconduct) Bill 2018  (henceforth, the bill) are supported, including the option of divestiture orders. However, as outlined in this submission the bill as currently drafted is limited, and divestiture order are likely to be unenforceable.

This document provides recommendations, for consideration by the Senate Economics Legislation Committee. The key recommendations are highlighted below, and supporting details can be found in the submission.

• Recommendation 1:  Divestiture orders should apply to prohibited conduct in the electricity contract market, where market concentration issues have a more signicant impact.
• Recommendation 2:  Provide a list of factors that must be considered by the Treasurer or Courts when determining whether the use of the penalties are `proportionate' to ensure that the threshold tests are implemented in a manner that complies with the wishes of Parliament.
• Recommendation 3:  Amend the denition of prohibited conduct in electricity spot market to include both scheduled loads, and non-scheduled generators.