Submission to Capacity commitment mechanism and synchronous services markets

PIAC responded to the Australian Energy Market Commission’s (AEMC) consultation on two rule change proposals:  

• Hydro Tasmania’s rule change request is to create a market for ‘synchronous services’, including inertia, voltage control and fault level/system strength. 
• Delta’s rule change request is to introduce a capacity commitment mechanism to provide access to operational reserve and other system security and reliability services.  

PIAC reiterated points made in our engagement with the ESB’s Post-2025 reform process as we believed they were relevant to any consideration of system services. PIAC supported the direction established in the ESB’s post 2025 to move towards a spot market for unbundled system services. More broadly, PIAC highlighted the need for a market for flexibility services, including those identified in the rule changes. We provided advice on the composition and design of a flexibility market.