The industry-led Working Group has been convened by the Australian Government Department of Climate Change, Energy, the Environment and Water (DCCEEW) and AusEnergy Services Limited (ASL).
The Working Group brings together specialists from across the energy ecosystem to co-design the initial set of electricity contracts that will form the basis of the Electricity Services Entry Mechanism (ESEM) and potentially the Market Making Obligation (MMO).
Working group members
- Tom Arnold, ACEN Australia
- Ally Bonakdar, NAB
- Paul Curnow, Akaysha Energy
- Stephanie Easton, Iberdrola Australia
- Paul Grzinic, Aurora Energy
- Nick Hawke, Clean Energy Finance Corporation
- Declan Kelly, Flow Power
- Andrew Mulder, RWE
- Jialin Shen, Ampyr
- Daniel Teng, Origin Energy
- Andrew Wilkins, SA Water
About the NEM Review
The Energy and Climate Ministerial Council (ECMC) commissioned the National Electricity Market wholesale market settings review (the NEM Review) to examine how wholesale market arrangements can support the transition to a renewable-based electricity system while maintaining resource adequacy and affordability.
The NEM Review’s final report, delivered in December 2025, included two key recommendations requiring standardised electricity contracts: the Electricity Services Entry Mechanism (ESEM) and the Market Making Obligation (MMO).
Following the success of the pilot co-design process undertaken as part of the NEM Review, the Review’s final report recommended that an industry-led co-design process should be convened to define the set of derivative contracts for use in these mechanisms.
Initial Co-Design Process
The initial co-design process will develop contract structures for use in the first ESEM tender, anticipated to occur in late 2027 subject to ECMC approval.
The process will run for up to 18 months from early May 2026, involving several in-person workshops and intersessional work including technical analysis and stakeholder consultation.
The Working Group for the initial contract co-design process will be supported by a Convening Group, comprised of representatives from the Commonwealth DCCEEW, ASL and in an observing capacity, the AER. Commonwealth DCCEEW has appointed L.E.K. Consulting as the independent facilitator of the Working Group, to support the design and delivery of the workshops and the broader co-design process. The Convening Group will oversee the Working Group's operations and provide administrative and resourcing support.
More information
For more information about the co-design process, selection criteria and process please refer to:
- Industry-led electricity contract co-design: Interim guidelines and procedures
- National Electricity Market Wholesale Market Settings Review – Final Report
- 2025 Pilot Co-design Process Outcomes
- Fungibility Fact Sheet
Further information can also be found on the Australian Government’s website.
Last updated 14 Sep 2026
Meeting 1
Meeting 2
Meeting 3
Meeting 4
Minutes - Electricity Contract Co Design Working Group Meeting 4
Workshop Discussion Materials
Bulk Energy Supporting Analysis
Supporting Analysis
Draft High Level Product Sheets
Bulk Energy Contract Structures Settlement Comparison Tool
Meeting 5
Last updated 14 Sep 2026
Contract Co-Design Working Group update webinar
14 July 2026
Contract Co-Design Working Group update webinar
1 September 2026
Last updated 14 Sep 2026
Have your say: Consultation on Electricity Contract Co-Design preferred contract structures
The Industry-led Electricity Contract Co-Design Working Group (the Working Group) is seeking industry feedback on the preferred contract structures for bulk energy, shaping and firming services.
This consultation is a key milestone in the co-design process and provides industry with a formal opportunity to help shape the final contract design and inform the Working Group’s final recommendations.
The Working Group has identified preferred contract structures for each service:
| Bulk energy | Firming | Shaping |
|---|---|---|
| Regional Reference PPA
A swap based on the dispatched volume and capture price of the regional Reference Fleet that provides buyers with a hedge based on a regional technology (e.g. wind or solar) shape and renewable sellers with long-term price certainty. |
Dynamic Time of Day Block Spread Swap A dynamically set swap that contracts the difference between the price in daily charge and discharge periods (determined by residual demand forecasts), providing buyers with a hedge against intra-day volatility and sellers with long-term revenue certainty. |
$600 Cap Contract
A cap with a $600 strike price that provides buyers with insurance against high-priced events and sellers with long-term, stable cashflows and ability to retain some merchant revenues under the cap. |
How to participate
Consultation on the preferred contract structures is open from 14 September 2026 to 2 October 2026.
Interested stakeholders are invited to review the Consultation Paper and Attachment A and provide feedback addressing the consultation questions. Feedback received through the consultation will help shape the Working Group’s final report and proposed contract term sheets, expected by the end of 2026. A summary of consultation feedback will be published following the consultation period.
Important notice
Stakeholders should note AEMO is currently undertaking consultation on the implementation of a mandatory framework for price responsive resource visibility and participation in dispatch (Market Visibility Framework), a recommendation of the NEM Review. This consultation can be found on AEMO’s website.
On Friday 11 September, Energy Ministers agreed to consultation on the regulatory reforms to implement the NEM Review recommendations. This package includes consultation on the proposed amendments to the National Electricity Law and National Electricity Rules relevant to the ESEM. Further details can be found on the DCCEEW Have Your Say webpage, with responses requested by 11.59pm (AEDT) Tuesday, 13 October 2026.
Last updated 14 Sep 2026