Integrating wind energy in the Australian National Electricity Market

Growing concern about climate change is heightening the need for power systems to be able to operate cost-effectively with high levels of wind energy penetration. In a restructured electricity industry such as in Australia, commercial, regulatory and technical challenges must be solved in an integrated and compatible manner. The Australian National Electricity Market has a number of features that together create a unique situation for wind energy integration: • It extends over 4000 km, with a single power system operator and market rules and with a largely consistent regulatory framework. • It uses an energy-only market design, with a five-minute market for energy and frequency-related ancillary services with associated derivative markets. • The system is of small rating, particularly given its geographical size, so that the transmission network is relatively weak and stability can be difficult to maintain. This paper describes the steps that have been taken to date in Australia to integrate wind energy in this context, as well as research that is currently under way to identify further design enhancements, considering engineering, economic and policy aspects