Wind Farms in a Gross Pool Market: Australian National Electricity Market Hugh Outhred School of Electrical Engineering and Telecommunications The University of New South Wales Sydney, Australia Tel: +61 2 9385 4035; Fax: +61 2 9385 5993; Email: [email protected]www.sergo.ee.unsw.edu.au Perspectives from Abroad Sustainable Energy Ireland, Dublin 13 June
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Wind Farms in a Gross Pool Market: Australian National Electricity Market Hugh Outhred School of Electrical Engineering and Telecommunications The University.
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Wind Farms in a Gross Pool Market:Australian National Electricity Market
Hugh OuthredSchool of Electrical Engineering and Telecommunications
Perspectives from AbroadSustainable Energy Ireland, Dublin 13 June
2
Outline
• Scope & design of the Australian NEM
• Managing supply-demand balance
• Ancillary service, spot & derivative markets
• Renewable energy certificate trading
• Network connection issues
• Conclusions
3
Electricity industry structure in SE Australia
Gen 1
Gen 2
Gen X
GenerationSector:-
largegenerators
Gen 3
TransmissionSector
NSWVictoria
South Aust.Queensland& possiblyTasmania
TransmissionSector
NSWVictoria
South Aust.Queensland& possiblyTasmania
Electricity
Financial instrument& REC (emission) trading
Distributor 1
Distributor 2
Distributor Y
Distributionsector
Electricity
Multi-regionNational
ElectricityMarket(NEM)
Intentionsoffers &
payments
Retailer Z
Retailer 2
Retailer 1
Retailsector
Intentionsbids &
payments
Tx networkpricing
Tx networkpricing
Networkaccess End-use
Equipment&
DistributedresourcesElectricity
End-usesector
Contestablecustomers
Franchisecustomers
RetailMarkets
Embeddedgenerators
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Key NEM features
• NEM covers all participating states:– A multi-region pool with intra-regional loss factors– Ancillary services, spot market & projections– Auctions of inter-regional settlement residues– Operated by NEMMCO (owned by states)
• Compulsory participants in NEM:– All generators & dispatchable links > 30 MW– Network service providers & retailers
• Contestable consumers may buy from NEM
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Region boundaries & inter-connectors
• Regions boundaries selected so that:– Transmission constraints are rare within a region– Frequently-occurring constraints are placed on
region boundaries
• Region boundaries to be reset as required:– Whenever a constraint occurs > 50 hours/year
• Unregulated inter-connectors are allowed:– If dispatchable so that it can bid like a generator:
• ‘Directlink’ the first (operating since July 2000):– 180 MW DC link between NSW & Queensland regions
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Scope of the NEM
• Queensland• New South Wales & ACT• Victoria• South Australia• Tasmania (on connection to the mainland)
NEM regions are indicated, and theirboundaries need not be on state borders
(e.g. two regions in NSW)
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NEM regional spot market model(Based on NEMMCO, 1997)
Try another NSPPrepare:•Preliminary program•Performance specification•Technical data lists•Application fee estimate•Commercial requirementsAdvise applicant
Prepare application Apply & pay fee
Provide additionalinformation
Investigate application:•Technical & economic studies•Liase with other NSPs•Seek additional information
Make offer to connectFinalise connection
agreement
Connection does notguarantee market accessunder all conditions
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National Electricity Code (NEC) connection requirements for generators
• Reactive power & voltage control capability
• Quality of electricity injected into network
• Protection requirements
• Remote control arrangements
• Excitation system requirements
• Loading rates
• Ride-through to avoid cascading outages:– Loss of largest generator; 175ms network fault
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NEC categories of generators
• Either market, non-market or exempt– Market implies sell to NEM
• Can then also sell ancillary services
– Non-market or exempt implies sell to retailer
• Either scheduled or non scheduled:– Scheduled implies centrally dispatched:
• Must then participate in the NEM processes of bidding, pre-dispatch & PASA
• Default category for generation projects > 30 MW• Not appropriate for “intermittent” generation, eg wind
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Future directions for NEM COAG Energy Market Review (2002) Recommendations
• Create a National Energy Regulator• Improve control of generator market power• Improve operation of derivative markets• Give NEMMCO a NEM-wide planning function• Increase number of NEM regions & aim for full
nodal pricing• Phase in interval metering & retail competition
for all end-users• Enhance competition and network scope for gas• Replace existing climate cahnge policies by
emission trading
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Key web sites
• COAG Energy market review:– www.energymarketreview.org
• National Electricity Market Management Company:– www.nemmco.com.au
• National Electricity Code Administrator:– www.neca.com.au
• Electricity Supply Association of Australia:– www.esaa.com.au
• University of New South Wales - Sustainable energy research group:– www.sergo.ee.unsw.edu.au