The Authority has discontinued an investigation into a trading conduct breach alleged of Genesis Energy Limited for not offering generation from Huntly Unit 4 on 9 August 2021.

The investigation found no breach, concluding Genesis’ behaviour to not offer HLY4 for the evening of 9 August was within the realm of behaviours consistent with that of a rational generator which does not hold significant market power.

The investigator modelled HLY4 turning on at different times on the morning of 9 August, allowing for scenarios where it was operating at its full capacity by 6:00 pm, and where it had only partially ramped up by this time.

The modelling found, for HLY4 to be at full capacity by 6:00 pm, price signals did not merit offering HLY4 generation.

There was a small window from approximately 10:45 am when Genesis could have made a decision to offer generation from HLY4 and been profitable. HLY4 is not a peaking unit and was cold on the morning of 9 August, meaning it would need around 9 hours to ramp up to generate at full capacity. Making a decision at this time would have enabled HLY4 to reach its minimum load by 6:51 pm, after the peak demand had passed.

This would have involved various risks, such as forecast prices changing, the start-up taking longer than expected, and running the unit in a way that creates extra physical risks to the unit. The investigator considered a rational generator may have weighed up the potential expected profit against the risks of running, and come to the same decision as Genesis not to run the unit.

The possible market power Genesis may have expected to have through HLY4 for the evening of 9 August was not assessed to be significant.

The Authority’s decision and reasons for that decision are published on our website.
 

The Authority has made a decision on the Code amendment to enable some energy storage system (ESS) owners to offer instantaneous reserve while discharging. This is also referred to as providing injectable instantaneous reserve.
 
The Authority published the draft decision on 6 July 2021 to provide certainty to participants and the system operator while developing and consulting on complementary ancillary services procurement plan amendments.
 
The Authority has made only minor changes to the draft Code amendment.
 
The Authority has reflected the Code change in the recent review of the system operator’s Ancillary Services Procurement Plan. The decision is published on our website.
 
The changes come into effect on 3 May 2022. The Code amendment final decision paper is available below.
 

Following the system operator’s periodic review of the Ancillary Services Procurement Plan (procurement plan), the Authority has decided to replace the procurement plan in its entirety so as to incorporate the changes proposed by the system operator.

The 2021 procurement plan review has been a little different this time. In addition to a range of general improvements, the plan includes additional provisions to enable battery energy storage system (battery ESS) owners to offer injectable reserve ie, instantaneous reserve while a battery ESS is discharging. These provisions will enable new technologies to participate to the fullest extent in energy and ancillary services markets.

The changes come into effect on 3 May 2022. The procurement plan amendment decision paper is available below.

Changes to the procurement plan align with the Authority’s amendment to the Code to enable energy storage systems. 
 

The cross-submission period for the settlement residual allocation methodology (SRAM) principles ended on 24 March 2022.

The Authority received 8 cross-submissions on SRAM principles which can be viewed along with the consultation documentation.

We are currently considering the initial 17 submissions, along with the cross-submissions as part of the next step in deciding on new SRAM principles. Those principles will then guide the development, over the coming months, of a new methodology for determining the allocation of settlement residual rebates.