Assessment of Summer Preparedness for the NSW Energy Market

In October 2018, the Hon. Don Harwin MLC, Minister for Energy and Utilities, wrote to the Hon. Niall Blair MLC, Minister for Trade and Industry, requesting that the NSW Chief Scientist & Engineer chair a panel to assess the adequacy of the state’s 2018/19 summer preparedness in relation to the energy market and associated emergency management.

The purpose of the Panel and the review it undertook have particular regard to the Department of Planning and Environment’s Summer Readiness Action Plan and the NSW Government’s responsibilities and levers in the energy market and emergency management, and identify any actions for emerging risks in 2018/19 summer and beyond.

The Panel and secretariat consulted with the Australian Bureau of Meteorology (BOM), the Australian Energy Market Operator (AEMO), network operators and jurisdictions on their summer readiness. The Panel examined issues including:

  • Estimates of unserved energy (USE) and other information sources to examine the likelihood of a Lack of Reserve event
  • Weather and climate effects that could impact supply and demand over the coming summer
  • Systems and protocols that are in place to respond and manage the electricity system over the coming months in particular the summer readiness plans of the Department of Planning and Environment (DPE) and the Australian Energy Market Operator (AEMO).

The Panel concluded that the NSW Government is well prepared for the coming summer, noting that protocols and exercises by the Department of Planning and Environment, other NSW Government agencies and industry stakeholders have improved summer readiness and energy emergency response over the past 12 months.

Whilst the overall risk of USE, as assessed by AEMO, is low for NSW for 2018/19 and well within the reliability standard, there are a number of risks that can impact on the security and availability of the electricity system, which the Panel notes have been considered by the relevant industry participants.

In assessing the adequacy of the NSW Summer Readiness Action Plan, the Panel has made several recommendations. The Panel report outlines these recommendations, an assessment of energy margins for NSW in summer 2018/19, assessment of the DPE’s procedures in the NSW Summer Readiness Action Plan and factors that may influence future summer preparation.

The Panel report was released on 28 December 2018 and is available here.