AEMO preps 5-minute change
AEMO says the National Electricity Market (NEM) is ready to introduce Five-Minute Settlement (5MS).
5MS will shift the current 30-minute wholesale electricity spot market settlement period to five-minutes, providing a better price signal for investment in faster response technologies, such as batteries and gas peaking generators.
In 2017, the Australian Energy Market Commission (AEMC) approved the introduction of 5MS, with Australian Energy Market Operator (AEMO) responsible for updating market procedures, designing and testing systems, and coordinating an industry readiness program.
Setting up the system involves changes to metering, settlement and prudentials, and bidding processes, as well as electricity retail and wholesale market systems.
“This is an important market reform that reflects the evolving energy system and an initiative that aligns very closely to AEMO’s priority areas as we navigate the energy future to the benefit of the market and all consumers,” says AEMO Chief Market Services Officer, Violette Mouchaileh.
The operator says the NEM is ready to introduce 5MS on October 1, 2021.
The AEMC will meet in coming days to discuss AEMO’s recommendation and industry feedback submissions, before making the final determination.
October 2021 will also see the ‘soft start’ of Global Settlement (GS),;a framework for the settlement of the wholesale electricity market.
This is meant to align the development of systems and procedures for both changes, reducing implementation costs. GS will fully commence on 1 May 2022.
More details are available in this PDF fact sheet.