On 2 April 2020 the AEMC made a final rule and final rule determination to enhance the frameworks for system restart and restoration. System restart ancillary services (SRAS) contribute to the overall resilience of the power system by enabling recovery following a major blackout.

The final rule:

• expands the definitions of SRAS and black start capability, to allow AEMO to procure the services needed to effectively and promptly restore supply to consumers
• clarifies that AEMO can take overall costs into account when procuring SRAS (including both short-term and long-term costs)
• establishes a transparent framework for the physical testing of system restart paths
• clarifies roles of the different parties involved in system restoration and the communication processes they must follow with respect to SRAS.

The Commission considers that these changes are necessary to make sure that the SRAS frameworks in the rules can adapt as needed as the power system continues to change. Taken together, these changes are expected to improve the security and resilience of the power system and reduce costs for consumers over the long-term. 

Rule change requests

The AEMC received two rule change requests relating to System Restart Ancillary Services (SRAS): 

• On 29 July 2019 the Australian Energy Market Operator (AEMO) submitted a rule change request (ERC0278) seeking to incentivise the provision of both system restart and restoration support capabilities from a range of different technologies. AEMO's rule change request is also intended to facilitate more extensive testing to verify the viability of system restart paths, increasing the level of assurance that system restoration will succeed. 
• On 6 September 2019 the Australian Energy Regulator (AER) submitted a rule change request (ERC0281) seeking to provide greater clarity and transparency about the roles and responsibilities of parties involved in responding to a major supply disruption, particularly in respect of information provision and communication protocols relating to SRAS. The AER’s rule change request has been informed by the findings of its Investigation report  into the black system event in South Australia in 2016, particularly the extent to which inadequate communication protocols contributed to the failure of contracted SRAS providers in South Australia to provide SRAS following the event.

These rule changes are related to a broader program of work that was undertaken by the Commission through its Review of the South Australian black system event. This review, which concluded  with a final report published 12 December 2019,  considered the overall resilience of the power system to high impact, low probability events, including the role that SRAS plays in this overall resilience. The final report recommended a range of new mechanisms to better manage risks to grid stability. It also mapped out an ongoing work program on power system resilience to meet future challenges.

Consolidation

On 19 September 2019 the Commission published a notice of the consolidation of ERC0278 and ERC0281. The two rule change requests are consolidated under ERC0278 and named System restart services, standards and testing. Given the common subject material and close interactions between the two rule change requests, it was considered desirable and efficient to consolidate the rule change requests.

Consultation paper and draft determination

The Commission published a consultation paper on 19 September 2019 seeking stakeholder feedback on the key issues raised in the consolidated rule change requests. The Commission received 19 submissions to the consultation paper, including a supplementary submission from AEMO.

The Commission published a draft rule determination on 19 December 2019 setting out a range of proposed changes to the SRAS frameworks to address the issues identified in the rule change requests. The Commission received 12 submissions to the draft determination.

Submissions to the consultation paper and draft determination can be found below.

Background

The  power system in the national electricity market is occasionally subject to major shocks, such as severe storm systems, which are known as high impact, low probability (HILP) events. These HILP events can damage infrastructure and cause major disturbances on the power system. If these disturbances are severe enough, they may overcome the various power system protection mechanisms, and result in a major blackout. These blackouts, known as “black system events”, have a major economic and social impact. 

The National Electricity Rules (NER) include a process for how to respond to these kinds of events. 

System restart ancillary services (SRAS) are the first component of this process. They contribute to the overall resilience of the power system by enabling recovery following a black system event. 

SRAS are procured by AEMO to mitigate the economic costs of black system events by kick-starting the process of restoring supply. SRAS are currently provided by generators with the capability to start, or remain in service, without electricity being provided from the grid. Once an SRAS provider has restarted its own plant, it provides energy to restart other generators and commence the processes required for system restoration. 

The NER also set out a framework for how the restoration of the system should be managed, once SRAS have done their work. This process of system restoration includes a series of coordinated actions from other generators, AEMO and network service providers. Careful planning and clear communication between these various parties is critical to the effective restoration of supply to customers.