Reserve Capacity Reviews
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Reserve Capacity Reviews
AEMO must regularly review certain processes under the Reserve Capacity Mechanism. These include:
- the Relevant Level Methodology;
- the Maximum Reserve Capacity Price; and
- the reliability criterion and load forecasting.
This page provides information on previous reviews that have been undertaken by the IMO.
2014 Relevant Level Methodology review
Under clause 4.11.3C of the Market Rules, AEMO must conduct a review of the Relevant Level Methodology every three years. The methodology, specified in Appendix 9 of the Market Rules, is used by AEMO to determine the quantity of Certified Reserve Capacity for a facility for a given Reserve Capacity Cycle, where the Market Participant has applied for certification of the facility (usually an intermittent generator) under clause 4.11.2(b).
Further information about past reviews, including all documentation, is available here.
Review of the reliability criterion and load forecasting process
Clause 4.5.15 of the Market Rules requires AEMO to review the Planning Criterion and the process used to forecast SWIS peak demand at least once every five years, beginning at Energy Market Commencement.
The IMO completed two reviews of the reliability criterion and load forecasting process since market start - the first in 2007 and the second in 2012. The IMO reviewed the reliability criterion and forecasting processes separately on both occasions.
2012 review of the Planning Criterion
The 2012 review of the Planning Criterion recommended that:
- the form of the Planning Criterion be kept;
- the reserve margin be decreased from 8.2 per cent to 7.6 per cent; and
- the unserved energy component of the Planning Criterion be retained because of its role in the determination of the Availability Curve.
The IMO prepared a Rule Change Proposal to implement the second of these recommendations, which commenced on 1 May 2013. Further information about this Rule Change Proposal can be found here.
The relevant documents, including the IMO's final report, consultant reports and public submissions, are available below.
IMO final report
Market Reform final report
Public consultation documents
Minutes from public workshop [63kB]
Public submissions received during the consultation period
Perth Energy [332kB]
System Management [466kB]
Public submissions received outside the consultation period
Market Reform draft report
Invitation for submissions
2012 review of the SWIS load forecasting process
The IMO engaged ACIL Tasman to undertake the review of the SWIS load forecasting process, and has implemented several recommendations, including:
- taking a more conservative approach to block load forecasting;
- completing an ex-post analysis of forecast accuracy; and
- tendering for forecasting services at least every three years.
More detail is available in the documents below.
IMO final report
ACIL Tasman final report
Documents related to the public workshop held 26 September 2012
Agenda for public workshop [32kB]
Submissions received during public consultation period
System Management [740kB]
Verve Energy [107kB]
Submissions received outside public consultation period
IMO's invitation for submissions
ACIL Tasman's draft report
2007 review of the Planning Criterion
The IMO engaged CRA International (CRAI) to conduct the review of the Planning Criterion in 2007. CRAI's main conclusion was that the reserve margin, measured in MW, was appropriate. However, it recommended that the Planning Criterion be linked to the forecast maximum electricity demand.
2007 review of the SWIS forecasting process
The IMO engaged Frontier Economics to complete the 2007 review of the forecasting process.
The relevant reports can be found below.
Reserve Capacity Mechanism progress report
In May 2009 the IMO published the Reserve Capacity Mechanism progress report, detailing the historic performance of the RCM and projecting the capacity position to the 2014-15 Capacity Year.
The projections to 2014-15 accounted for the information available to the IMO at the time, including new generation projects, load forecasts and an estimate of the impact renewable energy policies may have had on the capacity outlook.
The report is available below.Reserve Capacity Mechanism Progress Report [911kB]