The frequency control regime in the National Electricity Market (NEM) has been gaining increasing attention. Dramatic increases in costs for generators and ultimately customers are just the tip of the iceberg. A significant and growing body of evidence is revealing that the regime is not delivering outcomes that are efficient or in the interests of power system security.
On 19 April 2017 the Clean Energy Council held a workshop with 55 Sponsoring and Corporate Clean Energy Council members and observers from key government and industry organisations. The workshop attendees and speakers consisted of leading local and international experts on frequency control. The workshop took a deep dive into the frequency control regime in the NEM, examined the pros and cons of the current arrangements, and explored major flaws and opportunities for improvement that encompass the latest and emerging technologies. The presentations and materials can be found on the workshop event page.
The outcomes from the workshop include agreement that:
- the FCAS market design has undermined system security
- mandatory frequency control capability for new entrants needs consideration in the context of an inefficient market environment
- renewable energy generation developers should be proactive
- fast frequency response needs to be part of the NEM’s frequency control regime
- international practices should be considered
- the Australian Wind Energy Forecasting System should be revised
- the 35 MW FCAS regulation constraint in South Australia needs to be reviewed
- ancillary services unbundling will drive opportunities for innovation
- virtual power plants should be promoted in the NEM
Overall, the discussion highlighted that Clean Energy Council members have little faith in the existing frequency control regime and are concerned that it is not delivering appropriate technical or economic outcomes for electricity consumers. Workshop attendees also raised a significant concern that the existing regime provides an unsound footing to develop new markets and introduce new fast-acting frequency control measures from new technologies, such as battery storage.