The Energy Security Target Monitor is responsible for assessing and monitoring whether NSW will have sufficient firm capacity (generation, firming and storage, transmission capacity) to meet the Energy Security Target under different scenarios.
The Energy Security Target is the amount of reliable electricity needed to meet customer demand during a summer heat wave, plus a buffer. The Energy Security Target is designed to provide market certainty as it ensures there will be reliable supplies of electricity available to meet demands over the medium term.
Energy Security Target Monitor Reports
The Energy Security Target Monitor Report defines the Energy Security Target for the next 10 financial years. The Reports will consider:
- the amount of reliable energy needed to meet demand
- any anticipated shortfalls and recommends actions to take in the event of any shortfalls over the medium term.
Read the latest report from AEMO, ESTM Report October 2024.
Previous reports can be found below:
On 23 May 2024, the NSW Government announced that Origin Energy Limited had agreed to operate Eraring Power Station until August 2027 in return for Government underwriting against a share of its potential financial loss. For more information about the agreement, please see here.
The ESTM Report October 2024 highlights additional actions may be necessary to ensure a reliable electricity supply following the scheduled retirement of Eraring power station in 2027 and later in 2033 due to the retirement of Vales Point and Bayswater power stations. The Report also highlights that timely delivery of transmission infrastructure is critical to unlock intra-regional transfer capacity.
Some of the actions already taken to address this potential shortfall of electricity include:
- NSW’s allocation for 900 MW of new dispatchable capacity projects in the Capacity Investment Scheme Tender 3.
- The Energy Amendment (Long Duration Storage and Investment) Act 2024 legislated an additional minimum objective of 12 GWh of long duration storage by 31 December 2033 to meet the reliability standard in NSW.
- Incentivising the installation of new batteries in homes and small businesses under the Peak Demand Reduction Scheme from 1 November 2024.
- Establishing the Energy Security Corporation to make investments in storage projects, address gaps in the current market, and improve the reliability of our electricity network.
- Delivering the Waratah Super Battery as a network standby battery. This super battery will ensure a reliable supply of energy across the state, especially during times when it is needed the most, like in the event of power surges during a storm or bushfire.
- Providing grants to Transgrid and the AEMO for additional grid connection engineering resources.
The NSW Government accepted the Electricity Supply and Reliability Check-Up Report recommendation to transfer the Energy Security Target Monitor role to a NSW agency for the Electricity Infrastructure Roadmap (the Roadmap) under the Electricity Infrastructure Investment Act 2020 (EII Act).
From 2025, regular Energy Security Target Monitor Reports will be provided by the NSW Government.
The Electricity Supply and Reliability Check-Up Report also recommended AEMO continue providing energy modelling services for the Energy Security Target for NSW.
Firming Tender for Long-Term Energy Service Agreements (LTESAs)
The second tender for firming infrastructure was open for Project Bids from 3 April to 21 May 2023. This tender was for technologies that can be dispatched during times of peak electricity demand. Examples of firming technologies include battery storage, thermal storage, gas peaker plants and loads capable of participating in the wholesale demand response mechanism.
On 29 June 2023, the Commonwealth and NSW Governments announced the Commonwealth would commit additional funds for up to 550 MW of firming infrastructure as the first investment from the Commonwealth’s Capacity Investment Scheme (CIS).
Six projects were awarded from the tender process, which will provide 1,075 MW of firming capacity to the network.
The new firming infrastructure is expected to provide energy to the Sydney-Newcastle-Wollongong sub-region during times of peak consumer demand from December 2025.
For more information about Tender Round 2 and other tender outcomes, please see here.
Energy Security Corporation
The Energy Security Corporation (ESC) will make investments in storage projects, addressing gaps in the current market, and improving the reliability of the electricity network.
Eligible projects could include community batteries, as well as virtual power plants that allow households and communities to pool electricity generated from rooftop solar panels. These virtual power plants would decrease reliance on the grid and reduce power bills.
Delivering the Waratah Super Battery
To ensure NSW continues to have reliable energy supply following the closure of the Eraring Power Station, the NSW Government is delivering the 850MW /1680 MWh Waratah Super Battery.
The Waratah Super Battery will be the largest network standby battery in the Southern Hemisphere.
The Waratah Super Battery, together with other minor transmission upgrades, will allow Sydney, Newcastle and Wollongong consumers to access more energy from existing electricity generation. More information is available on the EnergyCo project page.
How the Waratah Super Battery will support reliable energy supply
Electricity supply to Sydney, Newcastle and Wollongong comes through several transmission lines from the north, west and south of NSW.
These transmission lines connect electricity consumers to electricity generation and have capacity limits on how much energy they can safely carry at any one time.
Currently, some of this capacity is kept in reserve to ensure the line stays within its technical limits in case there is a ‘shock’ to the system, such as a lightning strike or bushfire.
The Waratah Super Battery will act as a ‘shock absorber’ for the electricity grid, removing the need to hold transmission capacity in reserve so that transmission can be used to transfer additional energy to consumers from existing generation.