Rule Change: Open

Overview

On 11 June 2020, the AEMC initiated two rule change requests from AEMO relating to the compensation payable to participants affected by an AEMO intervention event. 
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On 11 June 2020, the AEMC initiated two rule change requests from AEMO relating to the compensation payable to participants affected by an AEMO intervention event. 

The consideration of these rule change requests is part of a wider Commission work program updating frameworks for interventions in the NEM.

When AEMO intervenes in the market by activating the RERT or issuing a direction, two kinds of compensation may be payable: one is directed participant compensation (only relevant to directions) and one is compensation for participants affected by (or dispatched differently as a result of) the RERT or a direction. 

Rule change request from AEMO 

On 19 September 2019, AEMO lodged two rule change requests relating to the framework for compensating participants affected by intervention events (set out in clause 3.12.2 of the national electricity rules - NER).

The first of the AEMO rule change requests concerns the compensation payable to scheduled generators and scheduled network services if they are dispatched differently due to an intervention event. Currently, these participants are eligible for compensation in relation to energy related losses but not losses related to market ancillary services. The AEMO rule change request seeks to address that by allowing participants to be compensated if they incur losses related to market ancillary services.

The second rule change request relates to scheduled loads which are dispatched differently as a result of an intervention event. Scheduled loads in the NEM include pumped hydro and large scale batteries. Compensation for scheduled loads is calculated in accordance with a formula which includes as an input the price of the highest priced band specified in a dispatch bid – known as “BidP”. AEMO’s rule change request seeks to change the definition of BidP as the current definition could result in participants being under-compensated where they are dispatched differently due to an intervention event.

The Commission has determined that these two rule change requests should be consolidated since they relate to the same clause in the NER. 

Submissions are due by 16 July 2020.

Links to other current intervention rule change processes

The AEMC is considering other rule change requests from AEMO dealing with aspects of the interventions framework. These are subject to separate rule change processes.

For more information, see below:

Compensation following directions for services other than energy and market ancillary services

Changes to intervention mechanisms

Removal of intervention hierarchy

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Documentation