Download presentation
Presentation is loading. Please wait.
Published byRobert Joseph Modified over 7 years ago
1
REALLOCATIONS
2
2 What is a reallocation? Reallocations in the NEM Reallocations in the GSH Discussion Reallocations and STTM
3
REALLOCATIONS CONCEPT - NEM 3 AEMO Settlement GeneratorRetailer Swap $60 / MWh NEM $100 / MWh 1 MWh $100 $40 $100 - $40 = $60
4
REALLOCATIONS 4 What is a reallocation? Agreement between two authorised counterparties Movement of settlement liabilities from one party to another o Typically takes advantage of the credit position in the market of the debit party to the reallocation Prudentially validated prior to system acceptance Binding agreement o Parties can reverse impact of a reallocation with a new reallocation o AEMO may cancel future reallocations during a default event
5
REALLOCATIONS - NEM 5 Types of reallocations in the NEM Ex post and Ex ante Dollar Energy (ex ante value initially unknown) Value of reallocations in the NEM Ex ante can reduce credit support requirements and settlement liabilities Ex post can reduce settlement liabilities for prudential management as an alternative to security deposits Market Participants and Reallocators can reallocate Reallocators are typically banks
6
REALLOCATIONS - GSH 6 Types of reallocations in the GSH Ex post and Ex ante Dollar Energy (ex ante value initially unknown) Value of reallocations in the GSH Can reduce credit support requirements Can reduce outstandings as alternative to security deposits for daily prudential management Can facilitate future trades without the need for posting extra collateral Market Participants and Reallocators can reallocate Reallocators expected to be banks
7
REALLOCATIONS - STTM 7 Discussion Reducing credit support requirements Alternative to prepayments for prudential management Unsecured credit (bank) in market
Similar presentations
© 2024 SlidePlayer.com Inc.
All rights reserved.