The national electricity market (NEM) is in a state of flux.
According to the Australian government’s Energy Security Board (ESB), over 60% of existing thermal generating resources (mainly coal) in the NEM are likely to exit over the next two decades as Australia transitions towards renewable generation (mainly wind and solar) and storage.
This transition away from large, synchronous, ‘always on’ generators towards asynchronous, weather-dependent renewable generators requires a revisit of existing markets and mechanisms to ensure they are ‘fit for purpose’.
Set up in 2017 to coordinate energy reform, the ESB aims to reform the NEM via its post-2025 market design to maintain security and reliability of the system during this energy transition and beyond.