On 3 March 2009 the AEMC approved terms of reference requesting the Panel to commence a review of the Reliability Standard and settings. The Reliability Standard and settings includes the Reliability Standard, the market price cap, the cumulative price threshold and the market floor price.
On 15 January 2010 the Reliability Panel published a revised draft report by ROAM Consulting which was previously published on 23 December 2009. View more
On 3 March 2009 the AEMC approved terms of reference requesting the Panel to commence a review of the Reliability Standard and settings. The Reliability Standard and settings includes the Reliability Standard, the market price cap, the cumulative price threshold and the market floor price.
On 15 January 2010 the Reliability Panel published a revised draft report by ROAM Consulting which was previously published on 23 December 2009.
The revised report has been issued as a calculation error was found in the modelling, subsequent to the publication of its draft report. The revised calculation results in a change to the recommended MPC levels. ROAM has also undertaken further modelling using 100 iterations of random outages.
The Reliability Panel's Draft Report relied on the modelling undertaken by ROAM Consulting. The Panel notes that ROAM now recommends that the level of the MPC should be approximately $16 000/MWh for the 2012/13 and 2013/14 financial years. The Panel also notes that ROAM now recommends a CPT of $240 000 for these years. Therefore, stakeholders should consider ROAM's revised draft report when making a submission on the Draft Report, or preparing a presentation for the Public Forum.
The Reliability Panel will hold a Public Forum in Melbourne on 12 February 2010. The Public Forum provides an opportunity for interested stakeholders to present their comments on the Draft Report to the Reliability Panel. Registration for the public forum can be done online using the registration feature and will close on Friday 5 February 2010.
On 23 December 2009 the Reliability Panel published its Draft Report. In this report, the Panel is proposing to:
- retain the unserved energy form of the reliability standard;
- leave the level of the standard at 0.002% unserved energy for each region, and for the NEM as a whole;
- retain the current scope of the reliability standard in terms of system security events, industrial action and ‘acts of God';
- retain the current operational approach of targeting to achieve an expectation of no greater than 0.002% unserved energy each year and in each region, and in the NEM as a whole; and
- consider compliance with the standard each year with the objective of providing continuous improvement to the processes that monitor and maintain reliability in the NEM.
In addition, the Panel has published a Draft Report from ROAM Consulting which provides analysis and recommendations on the values of the reliability settings to apply from 1 July 2012 such that the Reliability Standard is met. In particular, the initial findings from ROAM Consulting suggest that:
- The level of the market price cap (MPC) should be increased to approximately $20 000/MWh in order to meet the Reliability Standard;
- The level of the cumulative price threshold (CPT) is likely to need to be increased to $300 000/MWh to avoid increasing the number of MPC events which are affected by the administered price cap; and
- There is no justification for recommending any change to the market floor price.
Submissions on the Draft Report are due by 5pm (AEST) on Tuesday, 23 February 2010 and must be submitted electronically via the Australian Energy Market Commission's homepage.
Any questions in relation to this process should be directed to Jacqueline Crawshaw, Rory Campbell or Julian Eggleston on (02) 8296 7800 or at panel@aemc.gov.au
Background
On 3 March 2009 the AEMC approved terms of reference requesting the Panel to commence a review of the ‘Reliability Standard and settings' in accordance with clause 3.9.3A(a) of the National Electricity Rules (Rules), following the Rules consultation procedure.
Issues paper
On 26 June 2009, the Reliability Panel (Panel) published an Issues Paper in respect of its Review of the Reliability Standard and Settings (the Review). An explanatory note has also been published to highlight the interaction between the Review and the Panel's interrelated Review of the Operational Arrangements for the Reliability Standards. The Review will focus on the longer term issues of:
- the form and level of the existing Reliability Standard, and whether these are still appropriate for current market arrangements, given that more than 0.002% of annual (but not ten year) unserved energy was observed during the high temperature incidents in Victoria and South Australia on 29 and 30 January 2009; and
- the recommended market price cap (MPC), cumulative price threshold (CPT) and market floor price necessary to achieve the Reliability Standard.
Submissions on the Review were due on Friday, 14 August 2009.
Public Forum
The Panel held a combined public forum for the review of operational arrangements for the Reliability Standard and the review of the Reliability Standard and settings on Monday, 13 July 2009 in Sydney. At the forum, presentations were given by the Panel and AEMO.
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