Final reliability standard and settings guidelines published

01 December 2016

The Reliability Panel today published guidelines and an accompanying final determination in relation to future reviews of the reliability standard and settings. 

Reliability of the power system relates to ensuring there is enough capacity to generate and transport electricity to meet consumer demand. The Reliability Standard is the number that provides an acceptable level of reliable electricity supply at the lowest possible cost. This number is set by the Reliability Panel.

When determining the reliability standard, the Panel considers the appropriate trade-off between the value consumers place on supply reliability and the overall power system costs associated with achieving a certain reliability level. Tightening the reliability standard would reduce the costs associated with supply losses but it would also raise the prices consumers must pay.

Every four years, the Panel reviews the reliability standard and reliability settings that apply in the National Electricity Market. Following the most recent review of the standard and settings, the Panel recommended the development of guidelines which set out the methodology to be used for these reviews.

The new guidelines:

  • establish the assessment framework to be applied by the Panel when undertaking each review;
  •  identify an approach to assessment of each component of the reliability framework, including consideration of which components are to be reassessed in future reviews; and
  • outline a general approach to modelling to be applied by the Panel in each review.

The accompanying final determination sets out relevant analysis undertaken to inform the contents of the guidelines.   

The next review of the reliability standards and settings will start in early 2017.

Reliability Standard

The Reliability Standard is the number that provides an acceptable level of reliable electricity supply at the lowest possible cost.  In the case of the National Electricity Market, this number is applied on a national basis. The current Reliability Standard in the electricity market in Australia is 0.002% of unserved energy. Under this standard, sufficient generation and bulk transmission capacity is required so that, over the long term, no more than 0.002% of the annual energy of consumers in any region is at risk of not being supplied.  Unserved energy is the amount of energy that is demanded, but cannot be supplied, in a region and is defined in accordance with the power system security and reliability standards. It is expressed as either GWh or a percentage of the total energy demanded in that region over a specific period of time such as a year. A reliable power system has sufficient generation capacity. The ability to supply demand is also extended by the take-up of demand-side participation (DSP) in the market.

Media contact:
AEMC Communication Director, Prudence Anderson 0404 821 935 or (02) 8296 7817
1 December 2016