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Clearing market operation service provider

The Clearing Manager is the market operation service provider responsible for ensuring that market participants pay or are paid the correct amount for the electricity they generated or consumed during the previous month. NZX is contracted as Clearing Manager.

This involves a number of tasks, the most obvious one being invoicing participants for sale and purchase of electricity and related services. On a monthly basis, the Clearing Manager does this by combining reconciled quantity information provided by the Reconciliation Manager with half-hourly pricing information from the Pricing Manager to determine the amounts owed to and by each market participant. Annually, the Clearing Manager acts as the counterparty for over $6 billion worth of electricity transactions.

An equally important role of the Clearing Manager is ensuring that participants will be able to pay invoices for electricity they have consumed. This role is particularly important in an electricity market because unlike other products, electricity has already been consumed at the point it is invoiced, and can't be repossessed. If a purchaser fails to pay, then generators cannot be paid which may result in considerable cash flow issues. The Clearing Manager provides confidence in the market by continuously monitoring prudential security requirements. It also manages any disputes or payment defaults.

Clearing and Settlement processes and requirements are set out in Part 14 of the Code.

This page is related to: Market Operation Service Providers.

Back to top Last updated on 14 January 2013