The Australian Energy Market Commission (AEMC) is consulting on updated proposals to bolster system security as traditional thermal energy sources approach end of life and more variable renewable energy (VRE) generation and storage assets are introduced. 

Today’s update paper follows the AEMC’s August 2023 directions paper which outlined a set of proposed improvements to security processes and frameworks within the national electricity market, as part of the Improving security frameworks for the energy transition rule change.  

One of these was the ‘transitional services framework’ which aimed to allow the Australian Energy Market Operator (AEMO) to meet existing system security gaps in the current planning framework and trial the security capabilities of new technologies for a low or zero emissions power system. 

Currently, AEMO needs to regularly intervene to direct generators to manage system security to help ensure a more secure supply of power for energy consumers.  

Stakeholders generally accept the need for this framework but provided feedback around its design.  

After carefully considering their feedback, the AEMC has refined the transitional services framework, and is proposing adjusted timings for procurement, to ensure the framework supports investment in new technology and the transition proceeding at pace.

The AEMC also agrees that consistent with the updated energy objectives, emissions reductions should be considered in contracting decisions and has proposed a new obligation to meet this objective. 

In addition, the AEMC is proposing AEMO publish a transition plan every two years to keep industry informed of its arrangements to meet system security needs. 

AEMC Chair Anna Collyer said these changes, considered together, would provide clearer investment signals to support new technology that can strengthen security.   

“We have listened carefully to a range of stakeholders and believe these updated proposals balance industry’s desire for efficiency and transparency with the need for practical and adaptable security arrangements.  
“Achieving this balance is an important step in delivering secure, safe and low-cost electricity to consumers in a rapidly evolving energy landscape,” she said.   

The AEMC is now accepting feedback in response to these updated proposals.  
Written stakeholder submissions are being accepted until 5.00pm (AEDT) Thursday 1 February 2024.   

For more information about the arrangements proposed, or to provide feedback, visit the project page.   
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