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The transformation of the electricity sector is presenting both opportunities and challenges for system security, including for the management of power system frequency. The AEMC has conducted a comprehensive review of the market and regulatory frameworks that underpin frequency control in the NEM to determine whether they will remain fit for purpose in light of these opportunities and challenges. The review forms part of the AEMC’s ongoing system security work program, which aims to address risks to power system security as the electricity sector changes.

The report highlights several issues with the existing market and regulatory arrangements for frequency control, and makes recommendations on how they could be addressed. Specifically, the recommendations seek to:

  • address the recent deterioration of frequency performance under normal operating conditions
  • promote transparency of NEM frequency control performance and the competitiveness of the frequency control ancillary service markets
  • remove inefficient barriers to the provision of essential frequency control services by new technologies

These recommendations were developed in consultation with stakeholders. They represent the completion of this stage of the review and the action items assigned to the AEMC by the Finkel Panel in 2017.

The major deliverable of the final report is a work plan, developed collaboratively by the AEMC, AEMO and the AER, detailing actions to be taken by the market bodies, in consultation with stakeholders, to address the identified issues and to progress the recommendations referred to above.

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