1. SLIDE 1 POWER SYSTEM ADEQUACY – A TWO YEAR OUTLOOK 2011 October 2011 JAMES LINDLEY

2. SLIDE 2 AGENDA SLIDE 1.PSA Context 2.Overview of Studies and Results 3.Key Outcomes 4.Possible changes to next year’s PSA 5.Feedback

3. SLIDE 3 PSA CONTEXT First published in August 2010 Designed to complement the ESOO Examines Reliability and Security Aspects of the NEM o Security studies focus on impact of wind generation (Clean Energy Future Plan) 2 Scenarios Considered o Expected – Based on ESOO Medium Growth Scenario o Sensitivity – Expected Scenario less 1000 MW of Generation  Sensitivity scenario is NOT based on specific policy  Sensitivity scenario is designed to test robustness of results

4. SLIDE 4 STUDIES AND RESULTS Reserve Capacity o Similar methodology to MT PASA o No reserve capacity shortfalls forecast Region 2011–122012–13 Reserve Capacity Shortfall (Days) Reserve Capacity Shortfall (MW) Reserve Capacity Shortfall (Days) Reserve Capacity Shortfall (MW) Queensland0000 New South Wales0000 Victoria0000 South Australia0000 Tasmania0000

5. SLIDE 5 STUDIES AND RESULTS Energy Adequacy o Similar methodology to EAAP o Reliability standard for USE expected to be met Region 2011–122012–13 Average USE Hours Total USE (MWh) % Annual USE Average USE Hours b Total USE (MWh) % Annual USE Queensland0.15350.0001%2.397010.0012% New South Wales0.482020.0003%0.08200.0000% Victoria0.35790.0002%0.561330.0003% South Australia0.38280.0002%0.53380.0003% Tasmania000.0000%00

6. SLIDE 6 STUDIES AND RESULTS Frequency Control o Considers loss of interconnector on Import and Export  Non-credible contingencies (worst case)  SA, SA+VIC, TAS and QLD studied  UFLS and OFGS Performance  Increase in wind generation impacts on system inertia o Results satisfactory except for:  Under frequency: SA, low demand/high wind problematic  Over frequency: SA,SA+VIC and QLD problematic o AEMO is currently reviewing UFLS in SA, and OFGS in QLD and SA

7. SLIDE 7 STUDIES AND RESULTS Interconnector Capability o Impact of high levels of wind penetration o Considers most limiting constraint o Small impact noticed when conventional generation displaced by wind generation Post contingency Control o Ability of power system to return to secure operating condition within 30 min o No problems flagged

8. SLIDE 8 STUDIES AND RESULTS Voltage Control – Reactive Power Reserves o Adequacy of reactive reserves assessed o Reserves adequate except in NSW  NSW reactive power reserves considered in 2011 NTNDP studies Voltage Control – Operational Issues o Areas were significant voltage fluctuations examined o Not expected to deteriorate significantly

9. SLIDE 9 STUDIES AND RESULTS Trends o Constraint behaviour  No significant trends over the last 2 years o Voltage Excursions  No significant trends over the last 2 years o Frequency Excursions  > 5 min on mainland  > 10 min in Tasmania  Slight decrease  New delayed frequency settings were implemented ~ 1 year ago

10. SLIDE 10 STUDIES AND RESULTS Frequency Excursions >5 min on mainland >10 min in Tasmania

11. SLIDE 11 KEY MESSAGES Over next 2 years o No reliability (reserve capacity and energy adequacy) issues expected o Significant new security problems are unlikely to occur  Frequency control is one possible area of concern and AEMO is currently working to address this issue o Clean Energy Future Plan is not expected to affect power system operations

12. SLIDE 12 POSSIBLE CHANGES Possible changes for next year’s PSA o Consider PV and other renewables in studies o Extra Frequency Control studies for Tasmania  Basslink out of service  Impact of minimum SCR constraint on frequency control o Adequacy of FCAS supplies in “Islanded” regions in particular SA and TAS

13. SLIDE 13 FCAS IN ISLANDED REGIONS FCAS and Inertia

14. SLIDE 14 QUESTIONS & YOUR FEEDBACK