AEMC publishes Rule Determination on Semi-Scheduled Generators

As noted on WattClarity a couple days later, we noticed a short notice from the AER alerting NEM participants and others to the request they’d received from the COAG Energy Council to develop two rule change proposals each focused on some perceived challenges with the operations of Semi-Scheduled generators:

Rule Change Proposal #1 = Continuous Disclosure

Rule Change Proposal #2 = Following Dispatch Targets

It will be important to come back to this request to understand the extent to which they have been addressed in what the AEMC is considering…

We also notified WattClarity readers on Sunday 28th June of the publication of the AER Issues Paper.

In the period that elapsed between the publication of the AER Issues paper and the submission of the requested rule change to the AEMC, there were a number of developments worth highlighting here:

1)  On 9th July, triggered by an association with Elton’s song spoke about ‘Too Low for Zero’ as a parable for the AER Issues Paper?.  The three paradigms noted there are worth understanding.

2)  On 17th July, Marcelle Gannon penned some thoughts under the title ‘Semi-scheduled generation–what are the real issues?’ to seek to focus discussions on what really mattered.

3)  On 24th July I contributed some thoughts in the article ‘Striving to understand the underlying challenges with Semi-Scheduled generators (re AER Issues Paper)’

4)  We even, in a very rare event, made a formal submission to the AER processes (hence the email on 28th Oct from the AEMC, being in their database of interested parties – though I suspect the ‘interested parties’ category is broader than that).

… and in between all of this, a number of other interesting news articles and other publications were tagged into our Asset Catalog (emerging out of the earlier Generator Catalog) as developments and thoughts relevant to the Semi-Scheduled generators.

On Wednesday 30th September we noted that the ‘AER releases proposed rule change for Semi-Scheduled generators and dispatch instructions’.

The AEMC approved the fast-track process. We missed that, at the time (a few other distractions, like 13th October in QLD).

We noted the receipt of an email on 28th October (informing us that the AEMC would ‘Fast Track’ the Rule Change).

Hence (three weeks later) we saw the draft rule published, as discussed here.

Submissions were due, but there were only 10 submissions listed here at the time I write this.  My quick scan reveals much support for the rule change, though two statements did jump out:

Statement #1)  Stanwell did write:

“we are disappointed with the outcome and the “narrow focus” that has been adopted by the Commission and Australian Energy Regulator . Stanwell considers that an opportunity has been forgone to progress energy regulation that would manage the anticipated increase in impact of the semi-scheduled generation class. ”

Statement #2)  Tilt did write:

“It is clear that the draft rule change is intended to go beyond putting an end to negative price curtailment and capture ‘any relevant feature’. In its current form the rule change would hold SSGs accountable for any deviation to a dispatch instruction apart from when that deviation is due to a change in the availability in the resource (such as high temperature de-rating). In order to remain compliant under the draft rule, contrary to statements made in the AEMC’s draft determination, SSGs would be required to make control system upgrades to account for technical limits such as temperature de-rating for the purposes of dispatch. TLT anticipates that around one year would be required to scope, design, implement and test such systems.”

Somewhat related to the concerns raised by Tilt were the comments Marcelle made on 18th December 2020 here that spoke to both:

1)  The underlying level of difficulty (and hence confusion) for Semi-Scheduled generators of even notifying the AEMO of limitations like high temperature de-rating, using (clunky) current systems; and

2)  Some suggested ways that this could be improved.

We’ve not seen anything further about these suggestions, I believe?

The AEMC publishes its final rule (a few weeks delayed from the initially envisaged publication date).  I have not had time to assess how the comments from Stanwell and Tilt (above) were addressed in the final rule.

The particular issue at the core (generators intentionally switching off, contrary to the intent implied in the bid, at times of negative price) needed to be addressed.   It seems that all submissions supported this:

In this particular series of Case Studies we’ve been compiling (but have not found time to contribute to more recently) we’d seen some examples where this behaviour had seemed to occur … and some others that were a little bit more ambiguous.

It was not a large percentage of the instances showing large Aggregate Raw Off-Target results across all Semi-Scheduled plant, but it did seem to be a situation where ‘the genie was out of the bottle’ and that the situation could get a whole lot worse more quickly if this ‘loophole’ had not been addressed.

Now we will look forward to being able to find the time to continue exploring the wider exploration of challenges (tabulated here, and not just with Semi-Scheduled assets) that we see.

Stay tuned for the next Villain in this expanding list of Villains that threatens to make the energy transition bumpier than it would otherwise be.