AEMC system security review directions paper

The Australian Energy Market Commission (AEMC) today called for public submissions on a new plan to strengthen power system security.

The directions paper released today recommends mechanisms to facilitate the ability of the power system to accommodate new technologies.

The transition to a lower emissions power system has its challenges. The take-up of non-synchronous, intermittent generation like wind and solar is continuing at speed in response to mechanisms like the large-scale renewable energy target. The generation mix is changing as old synchronous power stations leave the market.

A power system with increasing non-synchronous generation has less inertia. Falling inertia means the system has less time to recover from sudden equipment failure before widespread blackouts.

Inertia is the energy momentum produced by spinning generators, motors and other devices which enables the system to ride through disturbances and maintain its operating frequency of around 50 Hertz. Technologies like wind or solar have no, or low, inertia and currently have limited ability to dampen rapid changes in frequency which make the grid insecure.

Reduced amounts of synchronous generation also mean that system strength has been falling in some regions. The system strength is a measure of the current that would flow into a fault at a given point in the system. Lower fault levels can mean that generating units and network equipment do not operate correctly, affecting the ability of the system to be operated in a secure manner.

The System Security Market Frameworks Review directions paper details recommendations on new ways to provide inertia and respond to sudden frequency changes.

Addressing frequency in a low inertia system

Frequency management is a system-wide challenge.

The Commission considers that there are both short term and longer term solutions to managing frequency in a low inertia system.  The solutions contain complementary mechanisms and anticipate the use and development of emerging fast-frequency response (FFR) technologies.

The Commission’s plan to provide enough inertia includes immediate actions:

  • new rules requiring network companies to provide a required operating level of inertia at all times. If networks can identify FFR opportunities like battery storage, wind farms or solar panels, those services could be used if AEMO agrees they are substitutable for inertia from synchronous sources
  • rules requiring new non-synchronous generators to be built in a way that makes them capable of providing FFR services if required in the future.

The package also proposes two mechanisms to improve the purchasing of both inertia and FFR services in the medium term:

  • investment incentives for network companies to provide additional inertia above the minimum required level
  • a market sourcing approach to provide FFR services which will allow the amount of FFR to be optimised with levels of system inertia and other existing frequency services.

Addressing reduced system strength

System strength management is a local challenge. Action is needed depending on the regional profile of generation – and the extent to which there is more or less non-synchronous generation.

The short circuit ratio is the ratio of system strength measured in megavolt amperes (MVA and the size of the connected generating unit. The power system’s short circuit ratio is decreased by the connection of a new non-synchronous generator; and the fault current is reduced by each retirement of a synchronous generator.

The Commission’s plan to strengthen power system strength includes:

  • new rules making networks responsible for maintaining a minimum short circuit ratio to connected generators which in turn must meet their registered performance standards above this level
  • arrangements to enable networks to charge connecting generators to cover the cost of remedial action if the entry of that new generator causes a breach to minimum short circuit ratios.
  • arrangements under which the costs caused by generator retirements would be met by networks and defined as a prescribed service which would be ultimately funded by consumers.

Next steps

The AEMC is calling for feedback on the System Security Market Frameworks Review discussion paper. Submissions are due on 20 April 2017.

Given AEMO’s function relating to the maintenance of power system security, this review draws upon the work undertaken by AEMO as part of its future power system security program initiated in December 2015.

Media contact:

AEMC Communication Director, Prudence Anderson 0404 821 935 or (02) 8296 7817


Security events happen when electricity supply breaks down. Causes include storm damage to wires or unexpected generation equipment failure. Breakdowns affect the stability of the power system. The system is secure when it can maintain technical parameters such as voltage and frequency and withstand faults when they happen.

Reliability events happen if there are not enough generators and poles and wires to transport electricity to customers on demand. Reliable supply needs adequate infrastructure planning and maintenance across the whole supply chain.

Fact sheet links

AEMC – system security review

Australian Energy Market Operator - frequency

Australian Energy Market Operator - power system strength