The Australian Energy Market Operator (AEMO) has released its 2025 Transition Plan for System Security—a roadmap to meet system security needs in the National Electricity Market (NEM) over the next decade as Australia transitions from coal.
AEMO CEO Daniel Westerman said, “The Transition Plan for System Security aims to help guide the sector through the next phase of the energy transition, focusing on the key transition points and actions needed to keep Australia’s main power system stable and secure.
“The report outlines the steps required to replace the system security services provided by coal plants that are retiring and unlock the growing potential of renewable energy, including rooftop solar, to help deliver a smooth transition for consumers,” he said.
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The coal-fired generation that has powered Australia for decades is retiring and renewable energy, firmed with storage and backed up by gas, presents the lowest-cost pathway to meet consumer needs as well as government energy and emission policies through to 2050.
Consumers also continue to be a driving force in Australia’s energy transition through their investments in rooftop solar, and more recently, the growing investment in home batteries and electric vehicles.
AEMO’s transition planning framework will help navigate transition points that require investment or material changes in power system operations. This includes managing system strength requirements in New South Wales, first identified by AEMO in 2021, as well as minimum system load risks in Queensland and other states from 2026 onwards.
“New investments and reforms are needed to maintain system security in advance of these transition points, with opportunities to co-optimise both reliability and system security investments to help keep costs as low as possible,” Westerman said.
“Industry and governments have actions underway to manage the identified transition points. AEMO will continue to work collaboratively to signal and support the required investments and reforms needed to maintain system security.”
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The report also includes AEMO’s annual assessment of system security for each NEM region and identifies investments for transmission network service providers related to inertia, system strength, and network support and control ancillary services.
In parallel with the report, AEMO commenced trials for system security services from new technologies or new applications of existing technologies.
“The outcomes of these trials will help inform operational practices and market frameworks to ensure the NEM can continue to operate securely and reliably,” Westerman said.
