The Australian Energy Market Commission is seeking your feedback on a rule change request that seeks to clarify the applicability of the National Electricity Rules during periods of market suspension such as black system events.
The National Electricity Rules allow for the spot market in a region to be suspended due to abnormal circumstances which make the normal operation of the market impossible. One of these circumstances was the South Australian black system event. On 28 September 2016, following the black system in South Australia, the Australian Energy Market Operator (AEMO) declared the spot market in the South Australian region suspended in accordance with its powers in the NER.
The market was suspended for 13 days and was one of only two market suspension periods in the history of the NEM. This lengthy period of market suspension exposed a set of issues with the existing framework for market suspension in the NER. These
- arrangements for market suspension pricing
- whether certain NER clauses apply during a period of market suspension, and
- the flexibility available to AEMO to prioritise certain core system security functions during a period of market suspension.
Following the South Australian black system event, the AEMC progressed two rule changes on market suspension pricing. This rule change focusses on the other systemic issues identified in respect of NER arrangements applying to market suspension.
The proposed rule is designed to make AEMO's processes explicit for prioritising different elements of the NER and to limit the degree of uncertainty, by providing some transparency as to how AEMO will use its powers. This enhanced transparency would assist the AER in its compliance activities, would enhance market participant confidence in AEMO's actions and assist co-ordination between AEMO and market participants.
Submissions on the consultation paper close on 4 February 2021. You can find the proposed rule, requested by the former COAG Energy Council, and the Commission’s consultation paper, on the AEMC website.
Media: Kellie Bisset, Media and Content Manager, 0438 490 041