Throughout the energy transition it’s even more important to review and improve systems to ensure they are fit for purpose. This is particularly true for approaches to forecasting and ensuring accuracy. For example, poor forecasting can result in unnecessary lack of reserve (LOR) or minimum system load (MSL) event declarations which result in substantial additional costs to consumers.
That’s why, in our response to AEMO’s ST PASA Replacement Project – Reserve Level Declaration Guidelines, we recommend it prioritises:
- Regular systematic review to refine LOR- and MSL-related forecast models and inputs, to eliminate systematic bias and minimise forecast error, and;
- setting parameters related to LOR (and MSL) declarations to be as close to a “risk-neutral” level as possible, better balancing the cost of false alarms with that of missed events.
What’s next?
The JEC will continue to support AEMO and other regulatory bodies to review and improve systems, to avoid additional and unnecessary costs being passed on to households.
