Article by Liam Rogers, Lawyer, MARQUE Lawyers Pty Ltd, 02 8216 3034
Recent rule changes to unbundle ancillary services and reclassify market loads bring aggregated battery storage providers closer to offering frequency services to AEMO.
The first rule change promotes more demand side participation in the ancillary services market by unbundling those services from the sale of energy. The result is a new type of market participant, the market ancillary service provider. This new participant can offer ancillary service loads (or aggregations of the same) into FCAS markets. The intention is that this will lead to greater competition in the market.
The second rule change allows market ancillary service providers to classify any load approved by AEMO as an ancillary service load (by removing the requirement for ancillary service load to be market load). Again the intention is that the rule change will promote competition and network security by increasing the amount of eligible load for ancillary services.
The changes are incremental and there are still barriers to aggregated energy storage playing a role in the frequency control market. For instance, the FCAS regime continues to discourage small capacity participants taking an active role in the market. Any aggregator of battery storage will need to wield a significant volume of storage before being permitted to participate in the market under the rules.
Consequently, it will take a resourceful business to utilise aggregated battery storage in the FCAS market to its full potential. More changes are needed to reform the rules to exploit the opportunities presented by existing technologies, and those on the horizon.