Next steps to underpin a future power system that is stable and secure

The recommendations of the Frequency control frameworks review’s final report were released 26 July 2018. The report details actions the Commission, the Australian Energy Market Operator (AEMO) and the Australian Energy Regulator (AER) will take to support better frequency control.

The work undertaken as part of this review adds to the toolkit we’ve already put in place to address the challenges of intermittent generation. There are two parts to this. The first is making changes now that help inform on-the-ground decisions for generators, large users, retailers and the market operator, and future policy decisions. The second is making further changes that might be needed to improve the stability of  electricity supply in the future once evidence is in from trials AEMO will be conducting, such as on integrating virtual power plants.

Stable frequency is an important part of maintaining a secure power system. Frequency varies whenever electricity supply does not exactly match consumer demand and uncontrolled changes in frequency can cause blackouts. The report includes actions to make the most of existing equipment as well as harnessing the power of new technologies to help keep the power system stable.

As the generation mix changes we need new ways to control frequency to deliver better frequency performance across the system. This will include new rules and operating techniques, and more transparent and regular reporting of frequency performance to inform investment and operating decisions.

To date, the AEMC has made five rule changes, and two more are underway, to address the immediate system security needs  of the transforming system. This includes requirements for networks to provide minimum levels of inertia and system strength, and new ‘last line of defence’ schemes to help AEMO better prepare for, and respond to, a system security emergency.

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Download the above image of the recommended actions.

Recommended actions

  1. AEMO-led trials and other actions to determine how frequency performance can be improved in the short term and new business models like virtual power plants can be integrated:
    • AEMO, the AEMC and the AER to establish a NEM virtual power plant program to understand the technical and regulatory requirements associated with virtual power plants providing FCAS and energy and network support services
    • AEMO to conduct a mainland trial of revised primary frequency control, building on experience from the Tasmanian trial.

  2. Detailed consideration of ways to procure essential frequency services in the longer term in a way that recognises the capabilities of all potential technologies and service providers:
    • AEMO to coordinate changes to generator governor settings following results of the survey conducted in April 2018
    • AEMO to publish a revised causer pays procedure and frequency interval data closer to real time.
    • AEMO to update the market ancillary services specification (MASS), refining expectations for how services should be delivered
    • AEMO to conduct AGC tuning as part of upgrade of its energy management system software.
    • AEMO to investigate and increase the quantity of regulating FCAS on a static or dynamic basis if necessary.
    • Industry to establish a set of nationally-consistent grid connection guidelines for distributed energy resources providing appropriate value and incentives for the provision of system security services by DER.

  3. New rules to enable new technologies and service providers to provide frequency control services:
    • AER to submit rule change requests on:
      • AEMO monitoring and reporting of frequency performance
      • AER monitoring and reporting on FCAS market performance
    • AEMO to submit a rule change request to allow Small Generation Aggregators to classify small generating units as market ancillary service generating units
    Medium term:
    • AEMO to assess the longer-term needs of the power system taking a holistic view of inertia, primary and secondary frequency control and any new needs. This will include assessing whether interim measures might be needed before long term mechanisms can be established. 
    Long term:
    • AEMC to develop a mechanism to incentivise the provision of sufficient quantities of primary frequency control services (and other services) informed by outcomes from trials and international approaches.
    • Reliability Panel to make further updates to the Frequency operating standard when needed.

    • Regular reporting by AEMO and the AER on frequency outcomes to promote transparency and help market participants make investment and operational decisions: