The Australian Energy Market Commission (AEMC) announced today an extension to a proposal to allow transmission networks to be more proactive in providing services that help keep the power system stable. 

The draft determination will now be published by 29th April 2021. 

The extension is due to the complexity of these reforms and the work still required to finalise a draft rule determination for full formal consultation. 

This comes following the final report for the Investigation into system strength frameworks in the NEM published on 15 October 2020, which set out the AEMC’s high level direction for evolving the system strength investment framework. 

System strength is an essential service in the power system. As well as maintaining stable operation, it involves keeping voltage under control when there are disturbances like faults. 

This proposal included a three-pronged approach:

  1. supply side – a new system planning standard for transmission network service providers (TNSPs) to meet given guidance by the Australian Energy Market Operator
  2. demand side – new access standards on new-connecting generators to reduce the overall need for system strength
  3. efficient coordination of supply and demand – a charging mechanism to send investment and locational price signals to new-connecting generators.

This rule change is focusing on how to get timely investment in system strength solutions. Other ongoing AEMC rule changes are focusing on how these investments, along with other system services, are optimised close to dispatch in the national electricity market (NEM). 

The Commission has been engaging with a range of stakeholders over the past few months to continue development of the high-level framework, including through bilateral meetings with interested stakeholders, sessions with our technical working group, and a public forum.

While this development is progressing well to date, there is further detail and analysis required for the Commission to be able to make a draft rule determination. As such, the Commission views it as prudent for an extension to allow this analysis and collaboration with stakeholders – especially AEMO, the Australian Energy Regulator (AER), and the Energy Security Board (ESB). Although no formal consultation will occur during this extension period, the Commission will continue to undertake informal consultation to progress this rule change, including:

  • welcoming discussions with any interested stakeholders on any aspect of the rule change
  • holding further sessions with our technical working group on specific aspects of the proposal collaborating closely with AEMO, AER and the ESB.

This extension also allows for this work to be advanced at the same time as consideration of operational measures for the scheduling and additional procurement of system services, which are currently being progressed through both the ESB’s post 2025 market design project, which includes work on essential system services and scheduling and ahead market design. 

Media: Kellie Bisset, Media and Content Manager, 0438 490 041; (02) 8296 7813