Nexa Advisory Submission – AEMO ISP Methodology

Nexa Advisory welcomes the opportunity to share our views and insights on AEMO’s Integrated System Plan (ISP) Methodology Issues Paper.

The ISP remains a critical planning and system design roadmap for the National Electricity Market (NEM) and a vital tool which informs investors, policy makers and broader industry as we progress Australia’s clean energy transition. However, given recent contention around this roadmap, there is a clear need for AEMO to improve the robustness of its modelling to deliver a high conviction forward view of the energy system and ensure the lowest-cost pathway to achieve this.

We support two key changes to improve the robustness of the ISP:

• providing a clearer view of distribution-scale and Consumer Energy Resource (CER) solutions
• gas analysis to support a more robust Optimal Development Path (ODP) for electricity – whilst retaining the current electricity sector modelling focus, and ensuring that the scope does not expand to provide investment planning (or an ODP) for gas infrastructure

We are concerned by two proposed amendments:

• the ‘restart timing’ for actionable transmission projects – as it embeds uncertainty around transmission network development into the ISP
• the perfect foresight changes – as the proposed approach introduces an arbitrary measure which would under-represent the role of storage in the National Electricity Market, without accurately reflecting the market dynamics of imperfect foresight. This would over-emphasise the role of other dispatchable capacity such as gas generation.

Read our submission here: Nexa Advisory submission – ISP Methodology