This is a belated, and back-dated article to help include more context for later articles.
On 28 March 2024, the Australian Energy Market Commission (AEMC) made a final determination and more preferable final rule to improve market arrangements for security services in response to rule change requests from Hydro Tasmania and Delta Electricity.
On the day, the AEMC published the Media Release ‘Final rule to improve security frameworks for the energy market transition’ which said (with our emphasis added):
‘The rule, shaped by extensive stakeholder feedback, builds upon existing tools in the power system to enhance system security procurement frameworks. It responds to two rule change requests from Hydro Tasmania and Delta Electricity.
As the energy market transitions, ensuring system security becomes increasingly complex.
While every day brings new information about how best to operate a future system with more inverter-based resources, the capabilities of emerging technologies are still being tested and understood and synchronous plant continues to retire. As a result, there may be periods of scarcity in essential system services.’
… and …
‘The rule proactively facilitates a secure power system transition by enhancing procurement frameworks to reduce reliance on directions and drive investments in new technologies.
It will also improve cost recovery arrangements for Transmission Network Service Providers’ (TNSP) non-network security contracts to promote efficiency and minimise price volatility for customers.
Further, the rule will increase transparency on current system security needs and understanding, and how the Australian Energy Market Operator (AEMO) plans to manage system security during the transition to a net-zero emissions power system.
The Commission has also introduced a new non-market ancillary service (NMAS) framework for transitional services, allowing AEMO to procure two new types of services to assist the transition to a secure net-zero power system.
Under the rule, a new annual reporting requirement known as the ‘transition plan for system security’ will be implemented, It requires AEMO to report on the steps it will take to manage system security through the transition.
Additionally, the final rule aims to improve real-time market notices and post-event directions reporting, providing more transparency to stakeholders.’
There’s more information about this Rule Change, and the preceding process, on the AEMC sub-site under ERC0290 here.
This includes the 163-page final determination:
Key Dates
The enablement of security services under the ISF Rule commences 2 December 2025 and must be
conducted in accordance with the Security Enablement Procedures that are to be published by 31
August 2025.
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