ASIC has released a consultation paper on proposed changes to the financial resource requirements of electricity market participants who hold an Australian financial services (AFS) licence. ASIC regulates some electricity market participants (or their related bodies corporate) in relation to over-the-counter (OTC) electricity derivatives used for the purpose of managing financial risks. Some electricity market participants in wholesale electricity markets deal in OTC derivatives, to manage the volatile price in the market for electricity, referred to as the spot or physical market. These participants are generally required to hold an AFS licence with appropriate authorisations and meet AFS licensee obligations including complying with financial requirements. Consultation Paper 177 Electricity derivative market participants: Financial requirements (CP 177) includes proposals for replacing the current financial requirements applying to these electricity derivative issuers with a simpler net tangible asset measure, and new liquidity and cash forecasting requirements.