Four Jemena subsidiaries have been ordered by the Federal Court to pay a penalty of $5.5 million for breaches of the National Gas Rules related to the Day Ahead Auction (DAA).
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The DAA is a central platform facilitated by the Australian Energy Market Operator (AEMO) that allows companies that transport gas to bid for available pipeline capacity. The auction is finalised a day in advance.
In court proceedings brought by the Australian Energy Regulator (AER), Jemena admitted that between 1 March 2019 and 22 February 2022 it breached rules 649(1) and 653(1)(a) of the National Gas Rules.
Justice Anderson ordered that Jemena pay a penalty of $5.5 million for the breaches.
AER deputy chair Justin Oliver said the judgment reinforced the importance of gas market participants having the necessary checks and systems in place to support the Day Ahead Auction.
“The Day Ahead Auction plays a vital role in making sure spare pipeline capacity can be used to transport gas throughout eastern Australia, but it relies on accurate and timely information to work effectively.
“This judgment is a reminder to all gas market participants of their important responsibility to provide accurate information so that the Day Ahead Auction can continue to support the efficient use of natural gas services for the long-term interest of consumers,” Oliver said.
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In addition to ordering Jemena to pay the penalty, the Court ordered the appointment of an independent expert to conduct a review of the Jemena subsidiaries’ controls, and for Jemena to pay $300,000 towards the AER’s legal costs.
