Welcome to the twelfth edition of Energy Spectrum Australia.
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Synchronous machines are infeasible to satisfy SA islanding inertia requirements
AEMO published Notice of South Australia Inertia Requirements and Shortfall on 27 August, which showcases the inertia requirements in the South Australia region. Although AEMO has assessed that the minimum threshold of inertia (4,400MWs) will be met, a shortfall has been projected for the secure operating level of inertia in South Australia.
AEMO previously declared a system strength shortfall for South Australia in 2017, as well as the 2018 NTNDP, leading to the procurement of four synchronous condensers in the South Australian region. Figure 1 showcases the Inertia Requirements Methodology, which reveals 2020’s inertia requirements in comparison to 2018, and incorporates findings from the South Australia islanding events in early 2020, alongside predicted levels of distributed photovoltaics (PV) and declining minimum daytime demand. Stage 1 covers financial year 2020-21 with no synchronous condensers installed, whilst Stage 2 covers financial year 2021-22 after four synchronous condensers are installed (Figure 1).
In both current and forecast power system conditions, without increased Fast Frequency Response (FFR), the inertia required to operate South Australia securely as an island is calculated to be at least 7,605MWs in 2020-21 and 14,390MWs in 2021-22. Installing the quantity Figure 1: 2020 inertia requirements for the South Australia region of the NEM of synchronous machines needed within South Australia
to meet this requirement is therefore unachievable.
A specification of requirements for FFR will need to be agreed between AEMO and ElectraNet to meet this inertia shortfall, and has requested for the required services for Stage 1 be made available from 1 October 2020. AEMO has also agreed with ElectraNet that the required services for Stage 2 will be made available from 31 July 2021.
Of significant interest to any potential battery storage participant is the ackowdledgement by AEMO that increased FFR will be required to allow for the stable operation of the SA grid. We could therefore assume it is very likley that an FFR market will form part of the new Post-2025 Market Design framework. The intial 45MW shortfall of FFR appers to have already been secured by Neoen through their recent 50MW upgrade to the Hornsdale Power Reserve. However, there is still another 85MW of FFR services that will be required in SA by 2021-22. SA has traditionally been the first region to experiecne system strength issues due to the shallow demand profile and high penetration of rooftop solar. Other jurisdictions in the NEM are following closely behind and we should expect that localised areas of the market such as northern QLD and southern NSW, as well as areas south of Brisbane and in northern Tasmania may expeince localised inertia and RoCoF issues requiring FFR.
We have seen these grid issues arise rapidly and AEMO require immediate responses to potential tender. It is likely that those developers with battery storage projects in these areas that are under development or in construction are likely to be able to secure these limited opportunites and the lucrative revenues that they are likely to provide.