Every year, AEMO works closely with governments and the energy sector to prepare for the summer peak demand period. Damien Sanford is responsible for managing Australia’s electricity and gas operations and explains how AEMO has moved early to prepare for summer following last year’s blackouts in South Australia and the closure of Hazelwood power station in Victoria.

We are very serious about tackling the operational challenges that summer throws at us and AEMO has brought forward its preparations and commenced planning for the upcoming summer in the third week of February 2017.  AEMO expects to have concluded its preparations by the end of October 2017, although conditions will be continually monitored throughout summer.  The objective of AEMO‘s summer preparedness, for 2017-18 is to:

  • Maximise the available generation fleet, transmission assets and demand side participation throughout the summer period

  • Maximise transmission system resilience, recovery and contingency management.

There are six action plans:

  1. Generation availability
  2. Transmission network availability and capacity
  3. Generator fuel availability
  4. Encouraging and maximising demand side participation
  5. Contingency planning
  6. Operational changes

Generation availability

AEMO is seeking to maximise the capacity of the generation fleet across the National Electricity Market (NEM), noting forced outages (or technical issues) or operating limitations on generation output can occur under some conditions.  As part of maximising the fleet, AEMO has identified all planned outages for maintenance and met with generators to look at the flexibility of the planned maintenance and whether outages can be moved. The impact of moving the maintenance is risk assessed against cost and reliability.  Generators have been cooperative with AEMO in this process, and generator outages that can be moved from the summer period have been moved, and those that cannot be moved, the lead-time to cancel the maintenance under an AEMO direction is now known. 

AEMO has already seen previously mothballed capacity in Pelican Point re-enter the market since the closure of Hazelwood power station.  Swanbank E power station has also been directed by the Queensland government to be available over summer, and is expected back into the market in early January.

AEMO is working with South Australian and Victorian Governments on the implementation of new generation – diesels and batteries in South Australia, and batteries in Victoria.  AEMO is supportive of these initiatives, and sees them contributing towards the security and reliability of the power system over the summer period.

A forensic analysis to understand restrictions, single points of failure or any other risks not previously known to AEMO of every generator in the NEM is well advanced, and is expected to be concluded shortly.  This will allow AEMO where possible to raise reserve levels and provide the trigger for earlier intervention on peak days where risk to some generation is identified.

Maximising the transmission capacity

AEMO has been working closely with Transmission Network Service Providers (TNSPs) to move interconnector outages outside the summer period, and maximise interconnector transfer capability.  Planned transmission outages materially impacting generator capacity have also been moved where this doesn’t present a safety risk.  These outages have either been brought forward or deferred where there are no equipment reliability concerns.

Preventative maintenance conducted by TNSPs has also been brought forward where possible, and AEMO has actively worked with all TNSPs to identify appropriate windows of opportunity to conduct this maintenance.  It should be noted that on days of high demand during summer, particularly where Lack of Reserve shortfalls are identified, AEMO will not allow planned maintenance to occur, unless it presents a safety risk, or the outage is already underway and recalling it would increase risk to the power system.

In addition to the above, we are working with TNSPs to implement or enhance the existing network through the implementation of schemes that maximise the transmission capacity – emergency control schemes, short term and emergency ratings of transmission elements to temporarily increase transfer capability under extreme operating conditions.

Generator fuel availability

AEMO notes generator fuel availability has received extensive media and political coverage in 2017.

In preparation for summer, AEMO has engaged with generation businesses to identify if adequate supplies of fuel will be available during critical times.  Fuel types include water for hydro generation, diesel, oil, coal and gas supplies for thermal generation.  Generation business are also required to provide weekly updates on any energy or fuel limitations under the Medium Term Projected Assessment of System Adequacy (MTPASA).  To the extent that any limits are found that may impact on the security of the power system, AEMO will work with industries and governments to facilitate a suitable resolution.

Encouraging and maximising demand side participation (DSP)

AEMO is actively promoting increasing levels of DSP across the NEM, and sees this as an important part of improving security and reliability of the national grid for this summer and beyond.  For this summer specifically:

  • AEMO has worked with the Australian Renewable Energy Agency (ARENA) and governments to pilot a demand response initiative for summer 2017–18, and is encouraging other market responses to provide firm capacity, particularly in the next two years.
  • AEMO is seeking offers of additional reserves for summer 2017–18 through the Reliability and Emergency Reserve Trader (RERT) provisions. The RERT allows AEMO to procure additional generation or load reduction capacity not normally available to the market, to maintain the reliability or security of the power system. AEMO has identified 1000MW of additional reserves through this process as of the end of September 2017.

Contingency management and other initiatives

Annually, AEMO and jurisdictions conduct emergency management exercises in September to test the NEM emergency management arrangements.  These emergency arrangements, have been developed by AEMO and jurisdictions to enable a co-ordinated response to power system incidents.

This year on 12 September 2017, AEMO and jurisdictions conducted a joint national gas and electricity response exercise to test contingency plans and emergency management arrangements.  The first of its kind nationally, the aim of Exercise Unisco was to practice the interoperability of national gas and electricity emergency management arrangements when managing major energy supply shortfalls in Australia. The lessons from this activity have already been incorporated in some plans.

Operational changes

AEMO’s operational practices and processes are continuing to evolve with the changing power system. Key changes that are occurring include:

  • Improvements in reserve management.  The current definitions used for Lack or Reserve (LOR) declarations are based around the loss of the largest generator in any given region.  AEMO considers that these definitions are too narrow given the changing nature of the electricity system. A rule change proposed by AEMO to change the definitions so the LOR system can be triggered by a wider range of risks than those presently allowed for is currently out for consultation with industry by the AEMC.  If successful, this new approach will be implemented in early January 2018.

  • Operator training.  As the power system changes and becomes more complex, so are the needs of our control room engineers.  AEMO recently benchmarked its training practices for a changing power system against similar international operators and identified benefit in extending the off shift simulation requirements of its engineers.  A key focus of this training remains on system restart, dealing with complex environmental impacts on the power system, reserve and contingency management, and undertaking directions.

  • Increased information from generators.  While generators have specific obligations to provide information on the status of their plant to AEMO to informal operational risk and market needs, AEMO has identified some improvements outside the scope of the existing regulatory arrangements which will enable AEMO to make more informed decisions under extreme operating conditions.  The generators have been supportive of this new approach, which is expected to be implemented prior to summer.

AEMO will also be scheduling a series of workshops, desktop exercises and one-on-one discussion with governments and industry to further expand on our summer preparedness activities. In these activities, we will be seeking similar information from those organisations on their own preparedness for summer.

Read an explanation on AEMO's Reliability & Emergency Reserve Trader Provisions here and further information on power outages from the Victorian Government here.