Market Review: Open

Overview

The COAG Energy Council has requested that the AEMC 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 requested that the AEMC review the factors which contributed to the "black system" event experienced in South Australia on 28 September 2016. 

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

On 18 April 2019, the Commission published an issues and approach paper to facilitate public comment on the systemic issues arising from the SA black system event and the Commission’s approach to the review. 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.  

The AER has not yet published a compliance report or issued any findings related to the black system event period itself (taken to be the 87 seconds between the loss of transmission lines in the mid-north of South Australia and the black system). As a result, the review will focus its assessment on the pre- and post-stages of the event. The Commission will defer consideration of the black system event period itself, until such time as the AER has publically reported or otherwise issued findings on compliance during this period. 

The Commission is intending to publish a draft review report in mid-September and a final review report in December. The Commission invites comments from interested parties in response to this approach paper by Friday 24 May 2019.

Background

South Australia experienced a ‘system black’ event at 16:18 AEST on Wednesday 28 September 2016. A substantial program of reviews and investigations has been commissioned in response to the event, including work by the Australian Energy Market Operator (AEMO) and the Australian Energy Regulator (AER) focussed on technical and compliance issues, respectively.

The COAG Energy Council has requested that the AEMC conducts a review that will build on the work undertaken by AEMO and the AER by identifying any systemic issues that contributed to the event or affected the response. The Commission is to provide a report to Ministers on:

  • any recommended actions or amendments to the regulatory frameworks that should be taken to address any systemic issues identified; and
  • the extent to which the recommendations will be addressed in the AEMC’s ongoing work program.

The TOR require that the final report be delivered to the Council six months after the finalisation of both AEMO’s investigation report and the AER’s compliance report. AEMO’s final report was published in March 2017. The AER has completed its compliance investigation into the pre and post-event stages of the black system event and published a report in December 2018. As at the time of publication of the issues and approach paper, the AER has reported on the pre- and post-event stages of the black system event only. Given the AER has not yet reported on the black system event itself, the Commission does not consider that the six-month timeline specified in the terms of reference has yet been triggered. The review is therefore currently being planned on a stand-alone basis. The Commission intends to review the time-lines for delivery of the review once further information becomes available. 

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Documentation

ISSUES AND APPROACH PAPER

AEMC Documents

Submissions