2019 saw the delivery of a number of reform packages related to the management of power system frequency in the national electricity system. In March 2020, as part of the Mandatory primary frequency response rule change, the AEMC published a revised frequency control work plan. The revised work plan provides an update on completed projects and a timetable for ongoing and future projects to improve the market and regulatory arrangements for managing power system frequency.

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. As demand patterns and the generation mix in the NEM evolve, we need new ways to control frequency to deliver better frequency performance across the system.

In July 2018, as part of its final report for the Frequency control frameworks review, the AEMC initiated a frequency control work plan which set out actions for the Commission, the Australian Energy Market Operator (AEMO) and the Australian Energy Regulator (AER) to support the stable and secure operation of the power system in relation to frequency control. The AEMC continues to update this work plan.

Building on the existing arrangements, recent developments include:

  • January 2020 — The Monitoring and reporting on frequency control framework rule commenced:
    • AEMO now produces weekly and quarterly frequency performance reports, as required by the new rule.
    • the AER now produces quarterly FCAS market performance reports, as required by the rule.
  • January 2020 — The revised frequency operating standard came into effect following the Reliability Panel’s review in 2019. 
  • February 2020 — AEMO released the Market ancillary service specification and causer pays procedure draft determination and draft report.

To date, the AEMC has made a number of rule changes 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, updated technical standards and impact remediation requirements for new connecting generators, and new ‘last line of defence’ schemes to help AEMO better prepare for, and respond to, a system security emergency.

The AEMC’s frequency control work plan sets out actions to make the most of existing equipment as well as harnessing the power of new technologies to help keep the power system stable. It includes new rules and operating techniques, and more transparent and regular reporting of frequency performance to inform investment and operating decisions.

A recent focus of the work plan is a series of rule change requests related to primary frequency response in the national electricity market:

In March 2020, the AEMC published the final rule and final determination for the consolidated Mandatory primary frequency response and Primary frequency response requirement rule changes. The final rule set a requirement for all scheduled and semi-scheduled generators in the National Electricity Market (NEM) to support the secure operation of the power system by responding automatically to changes in power system frequency.

As part of the Removal of disincentives to primary frequency response rule change and any other related rule change requests received, the AEMC will investigate the appropriateness of the existing incentives for primary frequency response and amend these arrangements as required to meet the future needs of the power system.

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The final determination for the Mandatory primary frequency response rule change request includes an updated collaborative work plan that sets out a series of actions that will be progressed by the AEMC, AEMO and the AER. An overview of the status of this frequency control work plan is provided in the table below:

Action Status

1. AEMO-led trials and other actions to determine how frequency performance can be improved in the short term and to facilitate the integration of new business models like virtual power plants

  • AEMO, AEMC and AER to establish a virtual power plant (VPP) program in the national electricity market to understand the technical and regulatory requirements associated with virtual power plants providing frequency control ancillary services (FCAS) and energy and network support services

For further information refer to AEMO’s Virtual power plant demonstrations page.

  • AEMO to conduct a primary frequency control trial in the mainland NEM, 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 as required
  • Ongoing
  • AEMO is coordinating changes to generator governors as part of the implementation of the Mandatory primary frequency response rule change.
  • The final rule makes AEMO responsible for publishing the Primary frequency response requirements   (PFRR  ), which outlines the required frequency response settings for scheduled and semi-schedule generators.
Refer to AEMO’s Primary frequency response requirements consultation page
  • 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 released the Market ancillary service specification and causer pays procedure draft determination and draft report in February 2020.
  • AEMO intends to publish the Market ancillary service specification and causer pays procedure final determination and final report in Q2 2020.

For further information, refer to AEMO’s Primary frequency response under normal operating conditions consultation page. 

 

  • AEMO to investigate and increase the quantity of regulating FCAS on a static or dynamic basis if necessary
For further information, refer to factsheet and updates on the AEMO website: Frequency and time deviation monitoring
  • Industry to establish a set of nationally-consistent grid connection guidelines for distributed energy resources. The guidelines should include appropriate value and incentives for the provision of system security services by distributed energy resources.
  • Energy Networks Australia (ENA) is developing technical guidelines through stakeholder consultation that will provide transparency regarding the technical requirements for distributed energy resources.
  • In March 2019, ENA launched the final Basic and low voltage connection guidelines  .
  • In September 2019, ENA launched the  Distributed energy resources grid connection guidelines.  
  • Work is underway to produce the next set of guidelines to address medium voltage (MV) and high voltage (HV) connections within the distribution system. These guidelines are expected to be released in 2020.
For further information refer to the ENA National grid connection guidelines project page.

AEMO continues its review of contingency FCAS quantities, including: 

  • The staged reduction of NEM load relief factors 
  • Review of maximum switch reserve quantity
  • Consideration of regional FCAS requirements
  • Minimum technical requirements for Regulation FCAS 
  • Ongoing
  • In December 2019, AEMO reduced the assumed mainland load relief from 1.5% to 0.5%
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. 
  • AEMO are progressing the Renewable integration study, which will quantify the technical renewable penetration limits of the power system for a projected generation mix and network configuration in 2025.
  • AEMO published a stage 1 report for the Renewable integration study in April 2020.
AEMO to consult on and publish an interim Primary frequency response requirements (PFRR). The PFRR will specify the required frequency response settings for scheduled and semi-schedule generators.
  • Consultation expected to commence in April 2020 and conclude by the end of May 2020
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
  • Complete
  • In July 2019, the Commission made a final rule to require AEMO to report on frequency and frequency control performance; and the AER to report on the performance of frequency control ancillary services (FCAS) markets. The rule commenced on 1 January 2020.
  • Ref. Monitoring and reporting on frequency control framework (ERC0273)
  • AEMO to submit a rule change request to allow Small Generation Aggregators to classify small generating units as market ancillary service generating units
  • AEMO will evaluate the requirement to submit this rule change request in Q2 2020.
  • This will be informed by outcomes from the NEM virtual power plant trials described above.
  • Reliability Panel to publish a final determination on stage two of the Review of the frequency operating standard
  • Complete
  • The final determination for stage 2 of the Review of the frequency operating standard was published in April 2019.  
  • 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.
  • Ongoing 
  • On 26 March 2020, the AEMC published a final rule, Mandatory primary frequency response which requires all Scheduled and Semi-Scheduled Generators in the NEM to provide primary frequency response outside of a narrow band either side of 50Hz. The substantive elements of the Mandatory primary frequency response rule commence on 4 June 2020 and sunset on 4 June 2023.
  • ERC0274 – Mandatory primary frequency response 
  • The AEMC to consider how the frequency requirements in relation to the maintenance of a satisfactory operating state are specified in the NER and the frequency operating standard.
  • Ongoing
  • The 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.

For further information refer to the AEMC rule change pages:

  • Reliability Panel to make further updates to the frequency operating standard when needed.
4. Regular reporting by AEMO and the AER on frequency outcomes to promote transparency and help market participants make investment and operational decisions:
  • AEMO to monitor and report on frequency outcomes on a voluntary basis
  • Complete.
  • The Monitoring and reporting on frequency control framework rule commenced 1 January 2020.
  • AEMO is required to produce weekly and quarterly frequency performance reports. 
Refer to AEMO time deviation and frequency monitoring 
 
  • AER to report on FCAS markets performance
  • Complete
  • The Monitoring and reporting on frequency control framework rule commenced 1 January 2020.
  • The AER produces quarterly FCAS market performance reports.
  • Refer to the AER Ancillary service cost report
  • Ongoing