The AEMC today published a progress update on its review of the regulatory and market frameworks needed to control frequency in the national electricity market (NEM).  

This progress update provides an overview of the issues being considered, stakeholders' views from submissions to the issues paper, and proposed next steps. Stakeholders will have further opportunities to provide feedback in response to a draft report, which is due to be published in March 2018.

This work is part of the AEMC’s ongoing system security work program and progresses a number of recommendations made in the Finkel review into the future security of the NEM.

The generation mix is changing. The connection of newer types of generators like wind and solar, and the retirement of existing conventional generators like coal is presenting challenges for the management of power system frequency. There are also fewer generators responding to changes in frequency and this has led to a deterioration in frequency performance across the system.

The AEMC has already responded to some of these challenges by introducing new rules to maintain minimum levels of inertia and system strength, require generators and networks to provide more detailed information about how their equipment performs, and to strengthen ‘last line of defence’ emergency frequency control schemes. These new rules also provide the Australian Energy Market Operator (AEMO) with more tools to manage the changing power system.

The Frequency control frameworks review is the next step in adapting the framework to maintain a secure system in a changing market. It is exploring opportunities to use new technologies and distributed energy resources to help manage system security. The review is considering whether:

  • mandatory generator governor response requirements should be introduced to support primary frequency control, drawing on AEMO investigations
  • new technologies, like wind farms coupled with batteries, offer the potential for fast-acting frequency control ancillary services to help control frequency in the transforming market
  • distributed energy resources can provide more opportunities to support power system security.

The objective of this review is to recommend the combination of changes that will provide a secure power system at the lowest cost to consumers.

The AEMC’s work on the review is informed by a technical working group comprising network businesses, generators, retailers, energy service providers, consumer representatives, AEMO and the Australian Energy Regulator (AER).

Media: Bronwyn Rosser, Communications Specialist, 02 8296 7847 or 0423 280 341