The Australian Energy Regulator (AER) has published the final System Security Network Support (SSNS) Payment Guideline (the Guideline). The new Guideline sets out how the AER will determine whether proposed contracts for SSNS services are likely to result in prudent and efficient expenditures.
The Guideline assists transmission network service providers (TNSPs) better understand how they can apply for AER review of draft SSNS contracts by providing guidance on the nature of the determination, the criteria we must have regard to, the process we will follow, and the type of information we may have regard to in a review.
We are publishing the final Guideline following consultation on the draft Guideline, on which we received 6 submissions. A marked up version of the final Guideline available on the AER’s website sets out how we took stakeholder feedback into consideration in developing the final Guideline.
Background
The AER is required to make this new type of determination, and to publish the accompanying Guideline, under the AEMC’s Improving Security Frameworks for the Energy Transition Rule Change, which was published on 28 May 2024. SSNS services include system strength, inertia, and network support and control ancillary (NSCAS) services typically provided by a synchronous generator or battery to ensure the power system is secure as we transition to more renewable generation.
Under this new process, TNSPs make an application to the AER setting out the proposed payments or payment methodologies for SSNS services in a draft contract between the TNSP and the SSNS service provider (i.e. typically a generator or battery). The AER may determine if the proposed payments are likely consistent with the operating expenditure objectives, criteria and factors and network support pass through factors set out in National Electricity Rules (NER) clause 6A.6.6A.