The Australian Energy Market Commission (AEMC) has made a final recommendation to extend the ‘interim reliability measure’ (IRM) put in place to support the reliability of the electricity system. 

As the electricity market transitions toward net zero and more variable renewable energy sources connect to the system, reliability needs to be carefully managed to meet the needs of households, businesses and industry.  

In 2020, at the advice of the Energy Security Board (ESB), Federal and State Energy Ministers agreed to the IRM of 0.0006 per cent expected ‘unserved energy’ to meet community expectations that electricity supply remains reliable during a "one-in-10-year summer" event.

The AEMC is required under the National Electricity Rules to review these interim arrangements, and in a final report published today, the AEMC has released a recommendation to extend the application of the IRM to the ‘retailer reliability obligation’ (RRO) to 30 June 2028. 

The IRM acts as a trigger for two measures designed to provide more certainty about reliability, including the RRO, which encourages retailers to establish contracts with other parties to ensure they are adequately placed to fulfil energy demand. 

The IRM is also a trigger for the ‘interim reliability reserve’ (IRR), an “out of market” capacity reserve that AEMO can procure in periods of high demand to further support the reliability of the power system. 

Considering the expected scale and pace of the energy transformation over at least the next five years, the AEMC recognises the role of the IRM in effectively managing reliability events in the system until 2028.

After consulting stakeholders and carefully considering the opportunities and risks identified through the rule change process, the AEMC is of the view these recommendations are in the best interests of consumers.

While the AEMC has published a final recommendation to extend the tighter standard for the RRO by three years, the IRM is considered a provisional measure.

This is until the Reliability Panel has completed its more comprehensive assessment of how tail risk should best be managed in the longer term in the form of a new reliability standard.  

The Commission will consider reviewing the need for the IRM beyond 30 June 2028, following the 2026 Reliability Standards and Settings Review. 

Media: Jessica Rich, 0459 918 964, media@aemc.gov.au.  

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