The AEMC today extended the period of time for making a final determination of the Reinstatement of long notice Reliability and Emergency Reserve Trader rule change by two weeks, to 21 June 2018. The extension will enable stakeholders to consider important information from AEMO about the operation of the RERT last summer which will now be available in late May.

The RERT is one of the tools available to AEMO to help avoid blackouts. It is a type of strategic reserve that allows AEMO to pay a premium for additional generation or demand response that’s not already in the market to be on stand-by when shortages are projected. 

Currently, AEMO may contract for reserves under the RERT for up to 10 weeks ahead of a projected shortfall.  AEMO considers that 10 weeks is too short and acts as a barrier to entry to a wider range of potential providers. In particular, AEMO’s recent demand response trials with ARENA have shown that short procurement lead times can make it challenging for demand response providers to participate in the RERT. AEMO proposes to increase the lead time to nine months.

The Commission is progressing this rule change under an expedited process as an ‘urgent rule’ so any changes can be applied in readiness for next summer. 

Due to today’s extension, stakeholder submissions on the consultation paper are now due by 31 May 2018 (previously 24 May 2018).

Media: Prudence Anderson, Communication Director, 0404 821 935 or (02) 8296 7817.

Background: AEMO’s RERT rule change requests

On 9 March 2018 AEMO submitted two rule change requests to the AEMC in relation to the RERT: 

  • the first rule change request seeks to extend the period allowed for AEMO to contract for reserves ahead of a projected shortfall
  • the second rule change request (Enhancement to the RERT) proposes broader changes to the RERT framework and is subject to a separate rule change request process.

The Commission is progressing the two rule change requests under different timeframes. The Enhancement to the RERT rule change request is due to be initiated in June 2018.