Overview
The Australian Energy Market Operator (AEMO) manages electricity and gas systems and markets across Australia, helping to ensure Australians have access to affordable, secure and reliable energy.
On 1 October 2023, AEMO in collaboration with government agencies, industry and market participants, delivered extensive reforms to the Wholesale Electricity Market (WEM), a key initiative to support the energy transformation in Western Australia (WA).
Supporting AEMO in this endeavor was energy market management system specialists and consultants to the electricity industry, PSC. With a deep understanding of AEMO’s systems, PSC was engaged in four WEM Reform implementation projects, contributing significantly to the successful Go-Live.
Challenge
Marking the WEM’s most significant transformation to date, the program involved implementing a co-optimized energy and essential system services market, paving the way for further reforms as the energy transition occurs.
- Shift from unconstrained to constrained network access – The most significant change in the WEM Reform was shifting from an unconstrained dispatch mechanism to a Security Constrained Economic Dispatch (SCED) mechanism. This addresses challenges from the previous unconstrained network access model, which led to delays in connecting renewable energy sources and inefficient network utilization.
- Working with an evolving energy landscape – Western Australia has the world’s largest standalone electricity grid with abundant wind and solar resources. However, current markets and systems were no longer fit for purpose for the growing mix of renewable and traditional energy sources, coupled with the rise of grid-scale battery storage.
- Program scale and complexity – With six workstreams and over 20 projects, the sheer scale of the program required a substantial pool of skilled resources with specialized knowledge of market systems and understanding of AEMO’s operational intricacies.
- Concurrent Digital Roadmap – Running in parallel was an AEMO organization-wide Digital Roadmap that aimed to modernize applications, enhance technical and cybersecurity standards, and incorporate new technologies.
- Technology systems overhaul – Around 80% of AEMO’s IT systems were set for change including the creation or updating of WEM procedures, highlighting the substantial modifications needed for the program.
Solution
Drawing on over 15 years of experience with WA’s market operator systems and possessing an in-depth grasp of AEMO’s technology stack and digital transformation, PSC proved to be an ideal partner for the WEM Reform Program.
PSC were engaged in four WEM Reform projects:
- Wholesale Electricity Market Dispatch Engine (WEMDE)
- Settlement Reform
- Reserve Capacity Mechanism (RCM) Reform
- Registration
In close collaboration with AEMO’s team of project managers and product owners, PSC were among the project partners who played a crucial role in navigating the complexities of the reform. PSC’s comprehensive involvement allowed for early identification of issues, ensuring seamless integration and contributing significantly to the reform’s overall success.
Results
The successful go-live of the new WEM on October 1st, 2023, stands as a major achievement for the WEM Reform Program. The transition was seamless with no critical issues encountered.
John McLean, PSC’s General Manager Market Systems, sees the accomplishment as a joint success for AEMO, PSC, and the other partners involved, expressing, “AEMO should commend itself for enabling constrained access to the electricity network, removing a barrier of entry for renewable generation facilities. PSC’s contribution to this very significant program has been recognized in Australia, and the collaboration with other significant partners show that when we work together, great outcomes can be achieved.”
Despite substantial changes required in regulations, market procedures and AEMO’s systems, all PSC’s projects were completed in accordance with updated time schedules and budget. AEMO extended appreciation to PSC, expressing gratitude for the invaluable support received.
