Energy Regulator Prepares to Pull Trigger on Industry Shutdowns to Prevent Summer Blackouts

Australia’s energy regulator has today come close to triggering one of its emergency measures to prevent summer blackouts.

With high temperatures forecast for Adelaide, the Australian Energy Market Operator (AEMO) contacted at least one South Australian company to tell it to be prepared to temporarily shut down.

A cool change, which arrived earlier than expected, meant that the company didn’t need to follow through.

Are you ‘ready and willing to turn off this afternoon?’

South Australian metal foundry Intercast and Forge is an electricity hungry business, with a power bill of about $8 million a year.

It’s a key part of AMEO’s plan.

Today it was contacted by AEMO and asked if it was “ready and willing to turn off this afternoon”.

Intercast and Forge could get as little as 10 minutes notice from the AEMO.

“The regulator will give us a call or a text message, they will ask us to turn off at least 10 megawatts of power,” foundry general manager Brett Lawrence told 7.30.

“What will happen then, for our factory, is it will shut down for up to four hours.

“What that will mean for the rest of the grid is there’s far less likely to have rolling blackouts through the grid.”

The foundry will be paid about $350,000 to shut down.

It is one of eight companies taking part in a $36-million so-called demand response trial.

“It’s really going to be a bag of tricks that enables the system to be far more secure,” Mr Lawrence said.

“So I think it’s not a band-aid, it’s actually a good way in which all the parties in the market can work together.”

‘We’ve done everything we can’

AEMO is on high alert after criticism of its management last summer, particularly after South Australia’s statewide blackout and when power was deliberately cut to homes during a February heatwave.

The situation became even more acute when Victoria’s 1,600-megawatt Hazelwood power station closed in March.

Apart from industry shut-downs, AEMO is bringing on new gas generation.

“We’ve gone out and gotten additionally, essentially close to 2,000 megawatts extra of resources that are going to be available to us,” chief executive Audrey Zibelman said .

“It’s those resources that are going to be replacing Hazelwood.

“Compared to last summer we feel like we’ve done everything we can and have done all the right things to make sure the system is ready.”