Rule Change: Completed
The Commission has made a more preferable final rule in response to a rule change request from COAG Energy Council. This final rule amends the National Electricity Rules (NER) to expand the contingency event framework to allow AEMO to manage the risk of ‘indistinct events’. It is consistent with the draft rule, with minor amendments to address stakeholder feedback.
The final rule provides AEMO with the flexibility to manage threats to power system security which are unpredictable and uncertain and can impact multiple power system elements (indistinct events), while minimising costs to consumers. It is important that AEMO can keep the system secure as abnormal conditions become increasingly frequent as the sector transitions and the climate changes.
Final rule and determination
The key elements of the final rule include:
- integrating ‘indistinct events’ into the existing contingency event framework by expanding the definition of ‘contingency event’ and expanding the scope of the reclassification criteria, which will require AEMO to update the criteria in consultation with relevant stakeholders;
- a new power system security principle requiring AEMO, where practicable, to make decisions about reclassification and measures to mitigate heightened risks that are predictable and consistent with the reclassification criteria;
- strengthening transparency and predictability for the expanded contingency event framework, including introducing a requirement for AEMO to consider improvements to the reclassification criteria through its regular reporting, and a requirement for specific reporting for when it is not practicable for AEMO to act in a manner consistent with the reclassification criteria; and
- leveraging existing governance arrangements, with guidance and oversight of AEMO's operational use of the contingency event framework to be provided by the Reliability Panel, AER and the Commission.
AEMO is required to update the reclassification criteria to reflect the broadened definition of ‘contingency event’ by 9 March 2023. The new principle and additional reporting requirement will commence at the same time as the updated reclassification criteria.
These changes will ensure AEMO is able to take action to mitigate any credible threats to the power system, even if the assets at risk and impacts cannot be explicitly identified.
Overview of the rule change process
The rule change request
The COAG Energy Council submitted a rule change request in May 2020 to amend the National Electricity Rules to introduce a framework to manage indistinct events.
The request proposed to manage the risk of indistinct events according to whether they were perceived to be ‘standing’ or ‘condition dependent’. Standing events would be integrated into the existing Protected Events framework with a new fast-track process introduced for non-controversial and/or straightforward events. A new protected operation framework would be introduced to manage condition dependent events. These events would either be pre-identified or managed in an ad hoc manner where they could not be pre-identified, with additional transparency and governance arrangements for ad-hoc events.
Key dates for this rule change
- Rule change request submitted - 26 May 2020
- Consultation paper published - 17 December 2020
- Submissions due 11 February 2021 – see below
- Draft determination and rule published - 28 October 2021
- Submissions below
- s107 extension of time granted to publish draft determination and rule (due to complexity of issues) – 22 April 2021
- Final determination and rule published – 3 March 2022
- Submissions due 6 January 2022 – see below
- s107 extension of time granted to publish final determination and rule (due to complexity of issues) – 22 April 2021
- s108A report published giving reasoning for a rule not being made within a year of initiation – 16 December 2021
Other relevant BSE review rule change processes
This was the third rule change request that the COAG Energy Council submitted following the BSE review. Information on the other BSE review rule changes can be found at the links below: