The Commission has made a more preferable draft rule clarifying the mandatory primary frequency response (PFR) obligations of scheduled bidirectional units (i.e. batteries with a capacity of 5MW or greater) in response to a rule change request received from the Australian Energy Market Operator (AEMO). Under the draft rule, batteries would have to provide PFR when they are exporting or importing energy, including when enabled to provide a regulation service. They would not have to provide PFR when solely providing contingency services or at
rest.

The draft rule seeks to promote the long-term consistent and predictable provision of PFR by balancing security needs and any incremental costs incurred by battery operators. Importantly, the widespread adoption of PFR will continue to play a key role in maintaining system security as the generation mix continues to decarbonise.

The consideration of this rule change builds on previous work completed by the Commission and the Reliability Panel to establish enduring arrangements for the long-term provision of PFR. In particular, the Commission notes that this proposal follows on the Primary frequency response incentive arrangements rule 2022 (PFR Incentives Rule) that confirmed the mandatory PFR obligations for scheduled and semi-scheduled generators introduced frequency performance payments and related reporting obligations.

The draft rule seeks to clarify the mandatory PFR obligations of scheduled bidirectional plant

On 30 November 2023, the AEMC released a more preferable draft rule to clarify the operating states during which scheduled bidirectional units are required to provide PFR.

Under the draft rule, scheduled bidirectional units would be required to comply with the primary frequency response requirements (PFRR) when:

• they receive a dispatch instruction to generate a volume greater than zero MW – commencing 3 June 2024
• they receive a dispatch instruction to charge (consume electricity) at a volume greater than zero MW (except when solely powering auxiliary loads) – commencing 8 June 2025
• they receive a dispatch instruction to provide a regulation service – commencing 8 June 2025.

Importantly, under the draft rule batteries would not be required to provide PFR when at rest and when enabled solely for contingency FCAS.

The Commission notes that a battery may be technically capable of providing PFR at all times, and may choose to do so given the benefits, including increased contingency FCAS registration, simplification of control systems, and receipt of frequency performance payments. The draft rule is not intended to preclude or restrict the provision of PFR in this case.

The draft rule includes several incremental changes that seek to build on the existing mandatory PFR and PFR incentives frameworks

The Commission also proposes several minor changes to the rules that seek to improve the effectiveness of the frequency control frameworks and promote the long-term, predictable, and consistent provision of PFR. These include:

• clarifying that scheduled bidirectional units would not need to renegotiate their connection agreement when revising PFR settings in accordance with the PFRR
• enabling AEMO to request that affected plant transmit the status of their frequency controller through existing communications equipment to improve AEMO's operational awareness of the frequency responsiveness of the system
• clarifying that semi-scheduled generators and scheduled bidirectional units may not change frequency control settings without the prior approval of AEMO.

Submissions to the draft determination are due by 25 January 2024

The Commission welcomes stakeholder feedback on the draft determination and rule. Collaboration through submissions, technical working groups (TWGs) and with other market bodies has been critical to developing the draft rule.

Written submissions must be lodged with the Commission by 25 January 2024.