Post: AEMO sets out path to low-emissions future

AEMO sets out path to low-emissions future

The Australian Energy Market Operator (AEMO) has released its first Transition Plan for System Security, marking a key milestone in the transition of the National Electricity Market (NEM) to a low-emissions future.

Published on 3 December, the report outlines AEMO’s strategy for managing power system security as the National Electricity Market (NEM) evolves towards a renewables-dominated system. Key measures include enhancing grid stability, integrating advanced technologies, and fostering collaboration among stakeholders. The plan emphasizes proactive risk management, workforce readiness, and innovation to support a reliable, low-emission energy future.

With renewables already supplying up to 75% of demand at times, and a significant portion of coal, gas, and diesel plants set to retire in the next decade, this plan is crucial for ensuring a reliable and secure electricity supply.

The Transition Plan further reports on the initial steps being taken by AEMO to use the new Transitional Services procurement framework to meet the Transitional Services Objective:

• Type 1 transitional services contracts to procure services necessary for the energy transition that cannot otherwise be provided through existing frameworks. 
• Type 2 transitional services contracts to trial new sources of security services or new applications of existing technologies to support system security.  

It also notes that Australia “leads the world in rooftop solar contributions to the power system”, and that at times there may not be sufficient demand available to utilise it efficiently. To support system security at these times of Minimum System Load (MSL), Type 1 contracts are potentially needed in the near term. AEMO is in the initial stages of considering how best to utilise and maximise value from the Type 2 framework.

Separately AEMO published a report providing details on the falling rates of minimum demand by jurisdiction and its need for a NEM-wide emergency backstop mechanism, “to allow rooftop PV systems to be curtailed or turned off briefly if necessary in rare emergency conditions”. AEMO also mentions other options available to manage minimum system load, specifically: 

• Reducing the amount of generation that needs to remain online to provide essential services;  
• Increasing demand in daytime periods, and 
• Installing more storage – to soak up solar power in the middle of the day.  

The Transition Plan complements AEMO’s annual System Security reports for Inertia, System Strength, and Network Support and Control Ancillary Services, as well as AEMO’s Engineering Roadmap program. AEMO considers the need for any power system security and reliability services in the NEM over the coming five to ten years as part of its obligations to assess system strength requirements, inertia requirements, and Network Support and Control Ancillary Services (NSCAS) needs. 

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