Key contractual In line with the requirements for Additional requirements for requirements ticketing and/or physical stock government including: Legislation for establishing obligation and rules around whether obligation can be traded or transferred Legislation for reporting, monitoring and compliance Possible need to have legislation allowing industry to set up a stock agency Industry would have to set up their own systems for contracting stock Funding Option of either general budget or With obligation on market the levy on fuel use cost would be passed through to consumers by industry. International and Provides international compliance Likely to provide some improvement – domestic security domestic security impact will to domestic security as well as depend on choice between physical international compliance. Government stock and tickets. Government would control release though control would control release. of the obligation level. Issues Do not gain any benefit from Complex implementation and much having a strong link between more resource intensive to operate – industry and government in may be difficult to justify with the provision of emergency stock. current commercial stocks reported as sufficient for supply security. Synthesis of options With two primary ways of holding stock and two key options for who takes responsibility, there would be four options for managing emergency stock. However with a combination of the type of stock and who has responsibility, there can be hybrid options, giving a total of nine options as shown in Table 9. Based on the preceding discussion the table indicates the trend or direction in cost, complexity and ability to manage different volumes against the options (with examples of the countries that use each system type). Table 9: Emergency stock options Ticket Tickets and Physical Stocks physical Stocks stocks
Key contractual requirements In line with the requirements for ticketing and/or physical stock Additional requirements for government including: Legislation for establishing obligation and rules around whether obligation can be traded or transferred Legislation for reporting, monitoring and compliance Possible need to have legislation allowing industry to set up a stock agency Industry would have to set up their own systems for contracting stock Funding Option of either general budget or levy on fuel use With obligation on market the cost would be passed through to consumers by industry. International and domestic security Provides international compliance – domestic security impact will depend on choice between physical stock and tickets. Government would control release. Likely to provide some improvement to domestic security as well as international compliance. Government would control release though control of the obligation level. Issues Do not gain any benefit from having a strong link between industry and government in provision of emergency stock. Complex implementation and much more resource intensive to operate – may be difficult to justify with the current commercial stocks reported as sufficient for supply security. Synthesis of options With two primary ways of holding stock and two key options for who takes responsibility, there would be four options for managing emergency stock. However with a combination of the type of stock and who has responsibility, there can be hybrid options, giving a total of nine options as shown in Table 9. Based on the preceding discussion the table indicates the trend or direction in cost, complexity and ability to manage different volumes against the options (with examples of the countries that use each system type). Table 9: Emergency stock options Ticket Stocks Tickets and physical stocks Physical Stocks
nesa-identified-issues-aust-energy-oil-obligation-2012.docx