Power system security relates to the technical parameters of the power system such as voltage and frequency. It’s about the power system’s capacity to withstand technical faults and continue to keep operating.

The AEMC’s system security work program is focused on developing market frameworks which allow continued take-up of new generating technologies while keeping the lights on at the least cost to consumers.

Our system security and reliability action plan outlines what the AEMC is currently doing to keep the power system secure as it transforms.

Our current work builds on a range of changes that have already been made over the last two years to give the Australian Energy Market Operator (AEMO) the tools it needs to keep the power system secure, strengthen the power system to withstand faults and failures and keep frequency operating within the correct range.

AEMC projects to improve power system security

Reliability Panel assessment of protected event request
The Reliability Panel made a final determination to declare the risk to South Australia’s power system posed by destructive wind conditions as a "protected event". Under the National Electricity Rules, the Panel can declare a "protected event", in response to a request from AEMO, if it finds there are net economic benefits from AEMO taking certain pre-emptive actions to manage a particular risk.

Improving system performance reporting
Rule requiring AEMO to report weekly and quarterly on the frequency performance of the power system and the Australian Energy Regulator (AER) to report quarterly on frequency control ancillary services (FCAS) market outcomes

Investigation into intervention mechanisms in the national electricity market
In August 2019 the AEMC published a final report which sets out a number of recommended changes to the interventions and compensation frameworks in light of the growing number of directions being issued by AEMO to maintain system strength. As part of this work, the AEMC is progressing two rule requests from AEMO which seek to amend both the interventions and related compensation framework. The report recommends that AEMO submit additional rule change requests that would further improve the interventions framework by - among other things - changing the basis on which compensation for directed participants is calculated, and narrowing the circumstances in which other participants can be compensated following interventions. Further work on system strength issues is underway (see below).

Investigation into minimum system strength and inertia frameworks in the national electricity market
In April 2019 the AEMC started consultation on potential changes to the interventions framework in light of the growing number of directions being issued by AEMO to maintain system strength. While the intervention framework provides an important safety net, it is not without costs and is not intended to be used to provide ongoing maintenance of power system security. This investigation is considering the experience to date with the current frameworks for managing system strength and inertia, and whether any refinements are needed. A draft report is due in October 2019. 

Improving intervention compensation and settlement processes
In May 2019 the AEMC made a final rule to improve administrative processes related to compensation and settlement after AEMO intervenes in the market – for example, when directing a gas or diesel generator on to maintain system strength.

Annual market performance review
In April 2019 the Reliability Panel published its annual review of the reliability, security and safety of the national electricity market for the period July 2017 to June 2018. The review highlighted how Australia’s energy system is cleaner and greener, but the speed of structural change is putting growing pressure on power system security and reliability.

Review of the Frequency operating standard review
In December 2018 the Reliability Panel published a draft determination for its review of the frequency operating standard. On the advice of AEMO, the Panel maintained the existing settings in the frequency operating standard in relation to these issues, noting that the immediate priority is the joint AEMC-AEMO frequency control work plan.

New technical performance standards for generators
In September 2018 we made significant changes to technical performance standards for generators seeking to connect to the national electricity grid, and the process for negotiating those standards. Under the final rule, a connecting generator's technical requirements are matched to local power system needs rather than a one-size-fits-all approach. This is key to keeping costs down for consumers.

New register of distributed energy resources 
In September 2018 we made a new rule for AEMO to establish a register of distributed energy resources, including small-scale battery storage systems and rooftop solar. The register will give network businesses and AEMO visibility of where distributed energy resources are connected to help in planning and operating the power system as it transforms.

Frequency control frameworks review
In July 2018 we published a final report for our Frequency control frameworks review  which recommended further changes to the market and regulatory frameworks to maintain effective frequency control as the generation mix changes. These recommendations are being progressed through our frequency control work plan is designing new, coordinated and lowest-cost ways to deliver frequency control services over the medium to longer term. We’re also working with AEMO on short-term changes to manage frequency deterioration, including encouraging generators to provide frequency control responses where feasible.

Package of new system security rules
In September 2017 we made final rules to:

  • manage power system fault levels – keeping the system stable by making networks provide minimum levels of system strength at key locations, and requiring new generators to pay for remedial action if they impact system stability
  • improve guidelines for generating system models – requiring generators and networks to provide more detailed information about how their equipment performs so AEMO and networks have the right data to efficiently plan and operate the system.

Emergency frequency control schemes
In March 2017 we made a final rule to help protect the power system from emergencies through a new management framework for emergency frequency control schemes. These are ‘last line of defence’ mechanisms such as controlled load shedding, designed to protect against a major blackout if a sudden and unexpected loss of generation or load causes rapid changes in system frequency. The new rules require AEMO to regularly and transparently assess emerging risks caused by swapping out older synchronous generators, for non-synchronous generation technology like wind and solar.