Preparing for Contestability

1
Preparing for Contestability

• Graeme Pollock
• Energy Consultant
• Maps Group Ltd

2
Key Parameters

• Understand the Players Roles
• Network System Providers
• Retailers
• Intermediaries/Aggregators (such as Maps Group)
• Understand your Current Position
• Pricing Regime
• Services Delivered
• Understand What You Will Be Offered
• Retailer Offerings Retail Energy Supply
• Administrator Charges (Nemmco, State Govt)
• Network Use of System and OMR Fees

3
Key Parameters Cont.

• Understand the Market Place
• Trading Strategies Market Volatility
• Retailer Motives
• Timing of Purchases
• Bulk Purchasing
• Market Rules
• Understand The Information Required
• Inventory Tables, Load Tables
• Annual Energy Use
• Be Ready, Willing And Able To Make a Decision On
  Offers as They Are Made

4
Other Key Issues

• Green Energy Purchases
• How Are You Going To Purchase?
• Single Buy
• Group Purchase
• Suitability to Probity Requirements within LG
• Term of Contract
• Risk Management
• Retailer Credentials
• What Service Levels Are Important?
• How Does this Energy Purchase Affect Lantern
  Selection and Physical Delivery?

5
Lessons From Interstate

• Time Your Purchase To Suit The Market
• Package Your Offering To Suit The Market
• And sell it hard!
• Dont Confuse OMR, Networks and Energy
• Ensure Market Risks Are Covered
• Be Ready To Decide Limited Validity
• Dont Be Afraid Of The New Market
• There are significant benefits
• Financial, Environmental and in Physical Service
  Delivery
• Delay may mean loss of these benefits

6
Maps Group in Electricity

• Maps Group Electricity Clients include
• Local Government in NSW, Victoria and SA
• Tertiary Institutions and Water Authorities
• Expert Electricity Industry Resources
• Extensive Network of Industry Contacts
• Relevant Public Lighting Knowledge
• Across multiple State/Territory market openings
• Contract Sourcing Experts in LG Environment
• 15 years LG Experience in general purchasing

7
Experience in Electricity

• Successful Tenders
• 1996 Vic Metered Supply 35,000,000 kWh
• 1998 Vic Metered Supply 100,000,000 kWh
• 2000 Vic Metered Supply 220,000,000 kWh
• 2001 SA Metered Supply 10,000,000 kWh
• 2001 Vic Public Lighting 120,000,000 kWh
• 2001 NSW Public Lighting 100,000,000 kWh
• Growth Exponential during 2000-2003
• Contracts With 4 Major Retailers In 4
  States/Trtys
• High Value Consultancy Services Also Available

8
Pool Prices SA 99-02