Market Review: Open

Overview

The COAG Energy Council has asked the AEMC to review the factors which contributed to the "black system" event experienced in South Australia on 28 September 2016.
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The COAG Energy Council has asked the AEMC to review the factors which contributed to the "black system" event experienced in South Australia on 28 September 2016. The AEMC’s review is a forward looking assessment of what changes to the regulatory frameworks are needed to manage new risks faced by the power system. 

The review draws on what has been learned since the South Australian black system event in 2016, to identify any structural changes that need to be made. The goal of the review is to reduce the risk of another black system event occurring again in future.

Discussion paper

On 15 August 2019 the project team published a discussion paper on how to better manage security risks in a changing power system. 

The discussion paper considers key policy areas including:

  • treatment of uncertainty from variable generation 
  • mechanisms to provide increased resilience to high impact, low probability events.

Submissions were due by 6 September 2019 and can be found below. 

Technical working group

The Commission convened a technical working group on 16 August 2019 to provide feedback on policy options under development. The group included representatives from the South Australian government and network businesses, the AER and AEMO, consumer representatives as well as industry representatives nominated by the Clean Energy Council, Australian Energy Council and Energy Networks Australia. Minutes of the meeting can be found below.

Next steps

The Commission plans to publish a final report in December 2019. 
The original review time table included a draft report to be published in September 2019. 
The  Commission now plans to proceed directly to publish a final report due to the publication of an additional discussion paper in August 2019.

Issues and approach paper

On 18 April 2019 the Commission published an issues and approach paper to facilitate stakeholder feedback on the systemic issues arising from the SA black system event and the Commission’s approach to the review. Submissions can be found below.

Background 

The COAG Energy Council’s terms of reference require the Commission to build on AEMO’s and the AER’s findings regarding the black system event. With the publication of both the AEMO incident report and the AER pre- and post-event compliance report by December 2018, the Commission commenced its review as required by COAG Energy Council in January 2019.

Specifically, the following are addressed:

  • contingency classification and the pre-event management of risks to power system security
  • system restoration following the black system
  • market suspension, and
  • arrangements to enhance power system resilience to high impact low probability events.  

On 7 August 2019 the AER commenced legal proceedings in respect of market participant compliance during the black system event period. As legal proceedings are currently underway, the Commission is not considering specific issues arising during the period between the loss of the transmission lines in South Australia's mid North and the occurrence of the black system condition. This review is only considering specific matters in respect of the pre- and post-stages of the event. 

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Documentation