This rule introduces changes to improve frequency control and system security in the national electricity market. 

Stable frequency is an important part of maintaining a secure power system. Frequency varies whenever electricity supply does not exactly match consumer demand and uncontrolled changes in frequency can cause blackouts.

This rule change is part of the ongoing Frequency control work plan which has been developed by the Energy Security Board (ESB) and market bodies which sets out a series of actions that Australian Energy Market Operator (AEMO), the AEMC and the Australian Energy Regulator (AER) are undertaking to review and reform the frequency control frameworks in the NEM. The final determination includes a revised frequency control work plan.

Final determination

On 26 March 2020, the Commission made a final rule to require all scheduled and semi-scheduled generators in the NEM to support the secure operation of the power system by responding automatically to changes in power system frequency.

The final rule is designed to address the immediate need to improve frequency control as identified by AEMO and the other rule change proponent Dr Peter Sokolowski . The substantive elements of the final rule commence on 4 June 2020 and sunset after 3 years on 4 June 2023.

Key aspects of the final rule include:

• all scheduled and semi-scheduled generators, who have received a dispatch instruction to generate to a volume greater than 0 MW, must operate their plant in accordance with the performance parameters set out in the Primary frequency response requirements (PFRR) as applicable to that plant
• AEMO must consult on and publish the PFRR, which will specify the required performance criteria for generator frequency response, which may vary by plant type.
• Generators may request and AEMO may approve variations or exemptions to the PFRR for individual generating plant.

The rule change requests

This final determination relates to two rule change requests, one from AEMO and the other from private individual Dr Peter Sokolowski.

Each of these rule change requests proposed to introduce a mandatory requirement for all scheduled and semi-scheduled generators to automatically respond to small changes in frequency either side of 50Hz, albeit through different proposed changes to the National Electricity Rules (NER).

The proponents considered that this change would improve the operational security of the national electricity system and its resilience to system disturbances.

AEMO’s rule change request states that:

• AEMO is increasingly unable to control frequency in the national electricity market (NEM) under normal operating conditions, due to reduced frequency responsiveness from generation. 
• the tools currently available to AEMO cannot effectively control frequency on an ongoing basis, and are increasingly resulting in power system outcomes that AEMO now regards as inconsistent with prudent industry practice.

Draft determination

On 19 December the Commission published a draft determination and draft rule - Mandatory primary frequency response.

The Commission received submissions from 24 stakeholders in response to the draft determination. These submissions can be found under the draft determination tab on this page.

Consolidation 

Alongside the draft rule and draft determination, the Commission also published a notice to consolidate the two rule change requests — Mandatory primary frequency response (ERC0274) and Primary frequency response requirements (ERC0277). The final determination and final rule were made with respect to the consolidated rule change request and named Mandatory primary frequency response.

Frequency control work plan

This rule change is part of the Frequency control work plan which sets out a series of actions that the ESB, AEMO, AEMC and AER are undertaking to review and reform the frequency control frameworks in the national electricity market. 

AEMO has advised that the application of a mandatory obligation on generators to provide primary frequency response will address the immediate system security needs of the power system.

The Commission recognises that a mandatory requirement for narrow band PFR is not a complete solution in the long term and considers that further work is necessary to understand the ideal requirements for good frequency control. Through the remainder of the work plan, the Commission will work with the ESB, AEMO, AER and stakeholders to consider the appropriateness of the mandatory requirement, and other alternative and complementary measures. 

The next stage of the work plan will involve the consideration and implementation of incentive arrangements for primary frequency response through the assessment of AEMO’s remaining rule change request, Removal of disincentives to primary frequency response and any other relevant rule change requests that are received. 

The final determination includes a revised frequency control work plan.

Consultation 

On 19 September 2019, the AEMC published a consultation paper which addressed the issues raised in all three of the rule change requests relating to primary frequency response (ERC0263, ERC0274 and ERC027). Submissions on the consultation paper closed on 31 October 2019 and can be found in the consultation paper tab on this page.

On 17 October 2019, the AEMC published a revised version of AEMO’s proposed Primary frequency response requirements, which were submitted to the AEMC along with AEMO’s rule change request. In the revised version, AEMO seeks to address concerns that have been raised in discussions with stakeholders. Marked-up and clean copies of the revised document can be found on the draft determination tab on this page. 

The revised Primary frequency response requirements document was submitted to the AEMC by AEMO. The AEMC did not have input into the document.