As the NEM Review lands, attention rightly turns to system-level settings. But much of the commercial change shaping renewable and firming supply is already unfolding inside over-the-counter (OTC) energy markets. This article sets out what’s already shifting commercially in a market under review.
Over-the-counter (OTC) energy markets are moving quickly as corporate renewable procurement starts to re-engage in pockets and project economics continue to shift.
These are the deals shaping how risk is allocated and how new renewable energy projects reach financial close - but they remain largely invisible unless you’re working directly on them.
The NEM Review’s final report, released today, reinforces this point by calling out the limited visibility across OTC (off-exchange) contracting.
In this article, we use ‘OTC’ in the same broad sense as the Review, to capture the full spectrum of off-exchange bilateral contracting, from long-term offtakes through to shorter-dated hedging activity.
The release of the final report provides a useful moment to look at what’s changing inside wholesale and retail offtake markets, and how these changes sit alongside the broader policy discussion.
This article is written for project developers, corporate energy buyers, intermediaries and investors who want a clearer view of how current contracting trends are interacting with broader market dynamics.
It builds on the themes we’ve explored throughout the year, with updated insights from our recent buyer and developer engagements. In this piece, we outline:
We’ll incorporate the Review’s outcomes across our commentary in the coming weeks, particularly where they intersect with contracting, liquidity and project development.
Bilateral offtake discussions are one part of the broader OTC market, and they’re often where the earliest adjustments to market conditions occur. For example, as The Energy noted, so-called “super-peak” swap contracts were traded on the OTC market several years prior to them being traded on the ASX.
Across this broader OTC activity, buyers and sellers are testing different approaches to firmness, flexibility and risk allocation in an ever-changing environment. These dynamics aren’t visible in exchange data or system-level settings, but they have a material influence on how projects progress towards financial close.
In the context of the NEM Review’s final report, it’s worth recognising that many of the commercial signals shaping contracting behaviour and liquidity formation are already emerging across the OTC market, including long-term offtakes and the downstream retail agreements.
These commercial signals set the context for the contract innovation we explore next.
Buyers and developers are responding to the same underlying conditions. As expanded on below, these conditions include:
The shared market pressures are shaping how parties think about firmness, flexibility and exposure, and they’re influencing the ever-evolving nature and structure of OTC contracting.
While these factors impact each side differently, they form the backdrop for the adjustments we’re seeing across current OTC activity.
A few buyer-side pressures are standing out clearly in bilateral activity.
These buyer-side shifts are shaping how OTC structures are evolving and creating the conditions developers are now responding to.
Developer-side dynamics reflect a different set of pressures.
Together, these developer-side pressures are driving the evolution of offtake structures and shaping the OTC contracting environment for 2026 and beyond.
As the final NEM Review lands, much of the attention will fall on system design, investment signals and the long-term settings needed to deliver new supply.
But the adjustments moving through bilateral activity within the OTC market provide an early view of how buyers and developers are already responding to these same conditions in practice.
These commercial signals sit underneath the Review’s system-level analysis and help show how risk is actually being allocated as the market prepares for the next phase of investment.
While the Review will clarify the structural parameters shaping the market, it will not capture the detailed commercial adjustments already occurring across OTC contracting.
Bilateral contracting – as a core part of OTC activity - reveals which products are gaining traction, where liquidity is forming or stalling, and how projects are progressing toward financial close.
These insights are important because they highlight the practical conditions under which the system the Review is examining will operate.
A few implications stand out.
These developments help set the scene for the deeper discussion we’re planning for early Q1.
The contracting shifts outlined in this article sit within a much larger energy transition.
As renewable supply, storage and firming requirements rise through the decade, the way risk is allocated across OTC contracting will be a key determinant for the pace at which new capacity progresses.
These dynamics won’t change overnight with the release of the NEM Review, but they will shape how its system-level settings translate into commercial decisions on the ground.
Understanding these signals matters for developers working toward financial close, for buyers managing exposure as load profiles evolve and for intermediaries and financiers navigating liquidity and bankability in a tightening market.
CORE Markets will continue to reveal these adjustments before they appear in broader indicators, making OTC contracting an important area to watch through 2026 and beyond.
In the new year, we’ll host a discussion with buyers, developers and intermediaries to examine these contracting shifts in more detail, drawing on front-line experiences and the insights we see across transactions.
If you’d like to be notified when details are confirmed, you can register your interest here.
What’s already changing in Australia’s energy market as the NEM Review lands
As the NEM Review lands, attention rightly turns to system-level settings. But much of the commercial change shaping renewable and firming supply is already unfolding inside over-the-counter (OTC) energy markets. This article sets out what’s already shifting commercially in a market under review.
As the NEM Review lands, attention rightly turns to system-level settings. But much of the commercial change shaping renewable and firming supply is already unfolding inside over-the-counter (OTC) energy markets. This article sets out what’s already shifting commercially in a market under review.
Australia’s updated 2035 emissions target, announced in September, has set a more ambitious national course for decarbonisation. Alongside this, a series of policy developments are beginning to influence market behaviour and expectations. These shifts are reflected in the updated ACCU market forecast.
