The National Electricity Market (NEM) is a wholesale market for electricity supply in Queensland, New South Wales, Victoria, South Australia, The Australian Capital Territory and Tasmania.

The NEM commenced operation in December 1998 as part of a program of significant reform to Australia’s electricity supply industry. The reforms led to the disaggregation of the vertically integrated government-owned electricity authorities into separate generation, transmission, distribution and retail sales sectors in each State. The goal of the reform process was to increase competition in the industry and provide greater choice for end-use electricity consumers.

The NEM is operated by the National Electricity Market Management Company (NEMMCO). Generators in the NEM bid their output into a wholesale electricity pool from which retailers and other market participants buy their electricity requirements at the wholesale spot price determined by NEMMCO based on the lowest cost generator bids required to meet the electricity demand.

More information on the operation of the NEM can be found on NEMMCO’s website at www.nemmco.com.au.

Tasmania entered the National Energy Market (NEM) on Sunday 29 May 2005. Tasmania’s NEM entry arrangements were authorised by the Australian Competition and Consumer Commission in November 2001. A copy of the authorisation can be found here. (PDF, 633 Kb)

Further details on the regulatory arrangements that are in place for Tasmania’s participation in the NEM can be found under Market and Regulatory Framework.