GUIDE TO NEM GENERATOR

CLASSIFICATION AND
EXEMPTION

PUBLISHED: AUGUST 2014

GUIDE TO NEM GENERATOR CLASSIFICATION AND EXEMPTION

Copyright 2014. Australian Energy Market Operator Limited. The material in this publication may be used in
accordance with the copyright permissions on AEMOs website.

Australian Energy Market Operator Ltd

NEW SOUTH WALES

ABN 94 072 010 327

QUEENSLAND

SOUTH AUSTRALIA

www.aemo.com.au
VICTORIA

info@aemo.com.au

AUSTRALIAN CAPITAL TERRITORY

TASMANIA

GUIDE TO NEM GENERATOR CLASSIFICATION AND EXEMPTION

IMPORTANT NOTICE
Purpose
AEMO has prepared this document to provide information about the classification and exemption of generators in
the National Electricity Market, as at the date of publication.

Disclaimer
This document or the information in it may be subsequently updated or amended. This document does not
constitute legal or business advice, and should not be relied on as a substitute for obtaining detailed advice about
the National Electricity Law, the National Electricity Rules, or any other applicable laws, procedures or policies.
AEMO has made every effort to ensure the quality of the information in this document but cannot guarantee its
accuracy or completeness.
Accordingly, to the maximum extent permitted by law, AEMO and its officers, employees and consultants involved
in the preparation of this document:

make no representation or warranty, express or implied, as to the currency, accuracy, reliability or

completeness of the information in this document; and

are not liable (whether by reason of negligence or otherwise) for any statements or representations in this
document, or any omissions from it, or for any use or reliance on the information in it.

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GUIDE TO NEM GENERATOR CLASSIFICATION AND EXEMPTION

CONTENTS
IMPORTANT NOTICE

1 INTRODUCTION

1.1

Purpose

2 GENERATOR CLASSIFICATIONS

2.1
2.2
2.3
2.4
2.5

6
7
8
9
9

Generator Classifications
Examples of generating unit classifications
Loss Factors
Scheduling
Fuel source and technology type

3 GUIDELINE ON EXEMPTION FROM REGISTRATION AS A

GENERATOR

10

3.1
3.2
3.3
3.4
3.5
3.6

Purpose
AEMOs power to make this guideline
Exemptions generally
Multiple functions and parties
Settling on market where an applicant would otherwise be exempt
Standing exemption for generating systems with nameplate rating of less than 5 MW

3.7

Application for exemption for generating units or generating systems with a nameplate rating of
less than 5 MW
14

3.8

Application for exemption requirement for generating systems with a nameplate rating of more
than 5 MW but less than 30 MW
14
Application for exemption for generating systems with a nameplate rating more than 30 MW
14

3.9

10
10
11
11
12
13

4 AEMOS POLICY ON REGISTRATION AS A NON-MARKET

GENERATOR
15
4.1
4.2
4.3
4.4
4.5

Introduction
Policy
Meaning of normal conditions
Purchase by both customer and local retailer
Meaning of at the same connection point

5 AEMOS POLICY ON CLASSIFICATION OF GENERATING

UNITS AS NON-SCHEDULED GENERATING UNITS
5.1
5.2
5.3

Introduction
The Policy
Conditional approval

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15
15
16
16
16

17
17
17
18

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6 AEMO'S POLICY ON CLASSIFICATION OF A GENERATING

UNIT AS A SEMI-SCHEDULED GENERATING UNIT
19
6.1
6.2

Introduction
Policy

7 AEMOS POLICY ON GENERATORS REGISTERING AS

CUSTOMERS
7.1
7.2
7.3
7.4
7.5
7.6

20

Policy
20
Examples of the application of the policy
20
Multiple points of connection to the network
21
Pump storage schemes
23
Customer load other than that used in an activity associated with the relevant generating system24
Impact of Connection Point Classification
25

8 FUEL SOURCE AND TECHNOLOGY TYPE

8.1

19
19

Introduction

27
27

TABLES
Table 1: examples of generating unit classification
Table 2: common fuel source types
Table 3: common technology types

7
27
29

FIGURES
Figure 1: single point of connection to the network
Figure 2: local connection
Figure 3: remote connection
Figure 4: local and remote connection
Figure 5: single point of connection
Figure 6: multiple points of connection
Figure 7: single connection point
Figure 8: retail supply

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21
21
22
23
23
24
25

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GUIDE TO NEM GENERATOR CLASSIFICATION AND EXEMPTION

INTRODUCTION

1.1 Purpose
This is a plain language guide, assisting any person seeking to register with AEMO as a generator.
Information about NEM participant categories is set out in Chapter 2 of the National Electricity Rules (Rules).
This guide has been developed to help registration applicants understand generator classifications and exemptions
and describes AEMOs policies relating to generator classifications. Where there is a discrepancy between the
information in this document and the Rules, the Rules takes precedence.
Italicised terms are defined in the Rules.
For more information about registration, please contact AEMOs Information & Support Hub
(Support.Hub@aemo.com.au) or call 1300 236 600.

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GENERATOR CLASSIFICATIONS

2.1 Generator Classifications

Any person who owns, controls or operates a generating system connected to a transmission
or distribution network must register as a generator, except where they meet the criteria for
an exemption. Exemptions may apply for certain generating systems under 5 MW, or under 30
MW with annual exports below 20 GWh. Section 3 provides a guideline on exemption from
registration as a generator.
In relation to each of their generating units, registered generators must be classified as either
market or non-market:
Market:

A market generator must sell all sent out electricity through the market, and
accept payments from AEMO for sent out electricity at the spot prices
applicable to its connection point. A generator must be classified as a market
generator unless all of its electricity output is purchased by a local retailer or
customer at its connection point.
A market generator with relevant capabilities can also classify its units as
ancillary service generating units.

Non-market:
A generator whose entire electricity output is purchased by a local
retailer or customer at its connection point must be classified as a non-market
generator. A non-market generator is not entitled to receive payment from
AEMO for any electricity sent out at its connection point, except for any
electricity sent out in accordance with a direction issued by AEMO to a
scheduled generator. AEMOS policy on registration as a non-market
generator is set out in Section 4.
Each market and non-market generator must further be classified as either scheduled, nonscheduled or semi-scheduled:
Scheduled:

A generator with an aggregate nameplate capacity of 30 MW or more is

normally classified as a scheduled generator if it has appropriate equipment
to participate in the central dispatch process managed by AEMO.

Non-scheduled:

A generator will normally be classified as a non-scheduled generator if:

AEMO August 2014

Its primary purpose is for local use and the aggregate sent out
generation rarely, if ever, exceeds 30 MW, or
Its physical and technical attributes make it impracticable for it to
participate in central dispatch.

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Non-scheduled generators do not participate in the central dispatch

process, but AEMO can specify additional conditions which must be
complied with, usually for power system security reasons. AEMOS policy
on classification of generating units as non-scheduled generating units is
set out in Section 5.
Semi-scheduled: A generating system with intermittent output (like a wind or solar farm),
and an aggregate nameplate capacity of 30 MW or more is normally
classified as a semi-scheduled generator unless AEMO approves its
classification as a scheduled generating unit or a non-scheduled generating
unit. AEMO can limit a semi-scheduled generators output in response to
network constraints, but at other times the generator can supply up to its
maximum registered capacity. AEMO's policy on classification of a
generating unit as a semi-scheduled generating unit is set out in Section 6.
The table below provides examples of the generator classification and exemption categories.
Note that the examples do not specify all of the criteria that need to be met.
Typical Capability

Examples

Less than 5 MW, all purchased by a local

retailer or a customer located at the same
connection point (automatic exemption)

1 MW backup diesel generator in a high-rise

building

Less than 30 MW, all purchased by a local

retailer or a customer located at the same
connection point and annual export less
than 20 GWh (application required)

20 MW biomass-fuelled generator with limited

fuel supplies

Non-market

Less than 30 MW, all purchased by a local

retailer or a customer located at the same
connection point

10 MW, all purchased by a customer at the

same connection point

Market

Between 5 MW and 30 MW, with some or

all sent out energy sold in the NEM

10 MW generator supplying the wholesale

market

Non-market

Intermittent output, greater than 30 MW,

all purchased by a local retailer or a
customer located at the same connection
point

150 MW wind farm, all purchased under

contract to a local retailer

Market

Intermittent output, greater than 30 MW,

with some or all sent out energy sold in
the NEM

150 MW wind farm supplying the wholesale

market

Non-market

Greater than 30 MW, all purchased by a

local retailer or a customer located at the
same connection point

40 MW hydro station, all purchased under

contract to a local retailer

Market

Greater than 30 MW, with some or all sent

out energy sold in the NEM

2000 MW power station supplying the

wholesale market

Exempt

Nonscheduled

Semischeduled

Scheduled

2.2 Examples of generating unit classifications

Table 1: Examples of generating unit classification
The following examples clarify the generating unit classification system.

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Description

Classification

500 kW solar panel and AC inverter

Exempt

1 MW backup diesel generating unit in a high rise building

Exempt

10 MW thermal station under contract to a local retailer or customer located at the

same connection point

Non-scheduled non-market
generator

10 MW power station supply for an electrically isolated country town

Exempt

10 MW wind farm with all output sold to local retailer

Non-scheduled non-market
generator

30 MW generating unit that exports up to 3 MW into a distribution system

Non-scheduled market generator

30 MW generating unit that exports up to 3 MW into a distribution system that is

entirely purchased by the local retailer

Non-scheduled non-market
generator

40 MW system of generating units internal to a major manufacturing plant that is

never expected to export energy

Non-scheduled non-market
generator

40 MW hydro station under contract to a local retailer for all of its output

Scheduled non-market generator

45 MW generating unit using 10 MW locally within its own site

Scheduled market generator

45 MW generating unit using 30 MW locally within its own site

non-scheduled market generator

45 MW generating unit using 30 MW locally within its own site and selling all
export to the local retailer or customer at its connection point

Non-scheduled non-market
generator

45 MW generating unit using 10 MW locally within its own site and selling all
export to the local retailer or customer at is connection point

Scheduled non-market generator

45 MW generating unit using 16 MW locally within its own site

Scheduled market generator

50 MW co-generation plant

Scheduled market generator

100 MW run of river hydro stations

Scheduled market generator

150 MW wind farm with all output sold to the market

Semi-scheduled market generator

200 MW brown coal generating unit with a 60% minimum load capability

Scheduled market generator

2000 MW power station connected to a transmission system

Scheduled market generator

2.3 Loss Factors

If a generating system is to be connected to the distribution network, at the time of making the
connection inquiry, you should request that the relevant network service provider calculate the
distribution loss factor that will apply to your generating system. If it is to be connected to the
transmission network, you should request AEMO to calculate the transmission loss factor that
will apply.

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2.4 Scheduling

A scheduled generator and a semi-scheduled generator must participate in the central

dispatch process managed by AEMO while a non-scheduled generator is not required to
participate.
A generator that is required to be a scheduled generator or a semi-scheduled generator may
seek an exemption from classification as a scheduled generator (see Section 4 of this Guide
for AEMOs policy on classification of non-scheduled generating units). AEMO will only
approve classification of a generating system that has a total nameplate rating of 30 MW or
greater as a non-scheduled generator if it is satisfied that conditions under clause 2.2.3(b) of
the Rules have been met.
Under special conditions, non-scheduled generators may have to respond to scheduling
requirements. See Section 5 for more information.

2.5 Fuel source and technology type

The fuel source and technology of all generating units must be submitted in the registration
application. Section 8 provides a list of the available categories.

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GUIDELINE ON EXEMPTION FROM

REGISTRATION AS A GENERATOR

3.1 Purpose
This Guideline on Exemption from Registration as a Generator (Guideline) sets out the
factors that AEMO will take into account when considering applications to exempt persons
from the requirement to register as generators in the NEM.

3.2 AEMOs power to make this guideline

Under clause 2.2.1(c) of the Rules:
AEMO1 may, in accordance with guidelines issued from time to time by AEMO,
exempt a person or class of persons from the requirement to register as a generator,
subject to such conditions as AEMO deems appropriate, where (in AEMOs opinion) an
exemption is not inconsistent with the national electricity objective.
Note:
A person who is exempt from registration as a generator, may register with AEMO as a
small generation aggregator under rule 2.3A.
The national electricity objective is set out in section 7 of the National Electricity Law (NEL),
which states:
The objective of this Law is to promote efficient investment in, and efficient use of,
electricity services for the long term interests of consumers of electricity with respect to

1) price, quality, safety, reliability and security of supply of electricity;

and
2) the reliability, safety and security of the national electricity system.
AEMO has issued this Guideline to detail the circumstances where a person might not be
required to register as a generator.

1 Italicised terms are defined in the Rules.

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3.3 Exemptions generally

The NEL requires a person engaging in generation in the NEM to register as a generator.
Exemption from this requirement can be obtained through a derogation, or otherwise under an
exemption from AEMO. This may be a standing exemption or a specific exemption granted on
application to AEMO. This does not preclude a potential generator who is eligible for
exemption (but wishes to participate in the market) from applying for registration.
Exemption means that persons who own the generating system to which the exemption
relates, are not required to pay participant fees and do not have to be scheduled or settled in
the market.
The Rules distinguish between:

generating systems with a nameplate rating of 30 MW or above that are required to be

classified as scheduled generating units or semi-scheduled generating units in order to
participate in central dispatch; and

smaller generating systems (classified as non-scheduled) that are not so classified

and do not participate in central dispatch.

AEMO considers that this division reflects the likely impact of generating units on the NEM
and is more likely to exempt persons from registering as generators where their generating
units have nameplate ratings below 30 MW.
3.3.1

Compliance with technical requirements of Chapter 5 of the Rules

You must confirm that your facility is either exempted from the technical requirements of
Chapter 5 of the Rules or will be able to meet or exceed its performance standards.
Generators seeking an exemption from providing information to confirm compliance with
technical requirements of Chapter 5 of the Rules, must provide:

evidence to support that they are eligible for exemption from registration for the
generating system; and

a letter from their network service provider stating that the generator is intended for
use in a manner the network service provider considers is unlikely to cause a material
degradation in the quality of supply to other Network Users (see clause S5.2.1(b) of
the Rules).

3.4 Multiple functions and parties

Clause 2.9.3 of the Rules provides that a person ordinarily required to register as a generator
may apply to AEMO for an exemption where it notifies AEMO of an intermediary to be
registered instead.
AEMO must allow the exemption where:

the intermediary consents to act as intermediary, in a form reasonably acceptable to

AEMO; and

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the applicant establishes to AEMOs reasonable satisfaction that, from a technical

perspective, the intermediary can be treated, for the purposes of the Rules, as the
applicant with respect to the relevant generating system.

In order to establish that the intermediary can be treated as the applicant, AEMO requires that
the intermediary apply for registration using AEMOs Application for Registration as a
Generator.
In addition, each party seeking an exemption is to provide relevant evidence in relation to the
technical perspective referred to above, which may include confirmation of a connection
agreement, joint venture agreement or related information.
Where a generating system involves multiple parties in ownership, control and operator roles,
one of them can be appointed as an intermediary, and the remaining parties can apply for
exemption from registration under clause 2.9.3 of the Rules. Each exemption application,
using the Application for Exemption from Registration as a Generator, is to be submitted
with the intermediarys Application for Registration as a Generator.
Where the ownership of generating units in a generating system is split, that is, different
parties might own, control, or operate different generating units, each party must be registered
separately in respect of the activities they carry out, or seek an exemption, as appropriate.
3.4.1

Revoking an Intermediary

The exempted person (owner, operator, or controller) may revoke the appointment of the
intermediary by giving notice of revocation to AEMO, which under clause 2.9.3 of the Rules
will take effect at 4.30 am, two-business days after AEMO receives the notice of revocation.
From this effective date, the intermediarys appointment is revoked, and the exemption
granted by AEMO to the exempted party also ceases. However before revoking an
intermediary, ensure that your registration application will be effective from the date of
revocation; or that you have appointed a replacement intermediary from that date.
Contact AEMO Information and Support Hub (Support.Hub@aemo.com.au) or call 1300 236
600 for more information.

3.5 Settling on market where an applicant would otherwise be

exempt
Regardless of the size of a generating unit, any person, who wishes to receive payment for
electricity generated by their generating unit through the NEM, then that person may apply to
AEMO for registration as a market generator and its generating unit must be classified as a
market generating unit.
In the case of a market small generation aggregator, if the generating unit has a nameplate
rating below 30MW and is covered by an exemption from the requirement to register as a
generator, the market SGA may classify the generating unit as a market small generating unit.

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3.6 Standing exemption for generating systems with nameplate

rating of less than 5 MW

Small generating facilities tend to have a nameplate rating of less than 5 MW and so cannot
significantly affect market outcomes or impact power system security, for example:

Emergency back-up generation

Small solar system

Minor hydro power stations

Small generating facilities entirely contained in an owners process

Generating systems on isolated networks

Therefore, AEMO has decided that a person who engages in the activity of owning,
controlling, or operating a generating system that satisfies any of the following conditions, is
automatically exempt from the requirement to register as a generator in relation to that activity
where both (a) and (b) apply:
(a) one of the following applies:
(i)

the generating system has a total nameplate rating at a connection point of

less than 5 MW; or

(ii)

the generating system is not capable of exporting to a transmission system or

distribution system in excess of 5 MW; or

(iii)

the generating system has no capability to synchronise or to operate

electrically connected to a distribution system or transmission system;

and
(b) either:
(i)

the sent out generation of the generating unit is purchased in its entirety by the
local retailer or by a customer located at the same connection point; or

(ii)

each of the generating units comprising the generating system is classified as a

market generating unit by a market small generation aggregator.

If you are in doubt as to whether your generating system can meet any of these criteria, you
may submit an Application for Exemption from Registration as a Generator for AEMOs
consideration.

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3.7 Application for exemption for generating units or generating

systems with a nameplate rating of less than 5 MW

There will be circumstances where a generating system might not be eligible for exemption in
accordance with the standing exemption referred to in section 0. Additionally, an applicant
might wish to be exempted from the requirement to register in respect of a generating unit
only.
A person may apply to AEMO for exemption from registration if the nameplate rating of their
generating system or generating unit is less than 5MW and if they are not eligible for
exemption under the standing exemption referred to in section 0 of this Guideline.
AEMO will consider the application and may grant the exemption in its absolute discretion and
based on any conditions it considers appropriate.

3.8 Application for exemption requirement for generating

systems with a nameplate rating of more than 5 MW but less
than 30 MW

A person may apply to AEMO for exemption from registration if the nameplate rating of their
generating system is between 5 MW and 30 MW, and either:

the generating system exports less than 20GWh in any 12-month period, or

there are extenuating circumstances.

AEMO will consider such an application in exceptional circumstances only, and may grant the
exemption in its absolute discretion and based on any conditions it considers appropriate.

3.9 Application for exemption for generating systems with a

nameplate rating more than 30 MW

A person may also apply to AEMO for exemption from registration if the nameplate rating of
their generating system is more than 30 MW.
AEMO will consider such an application in exceptional circumstances only, and may grant the
exemption in its absolute discretion and based on any conditions it considers appropriate. At
the very least, AEMO will need to be satisfied that the generating system will not have a
material negative impact on the operation of the NEM or the activities of market participants in
the NEM.

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AEMOS POLICY ON REGISTRATION AS A NONMARKET GENERATOR

4.1 Introduction

Clause 2.2.5(a) of the Rules sets out the conditions under which a generating unit is classified
as a non-market generating unit. This information is intended to be a guide only. Each
application for registration will be determined based on the relevant facts and circumstances.
Clause 2.2.5 (a) reads as follows:
A generating unit whose sent-out generation is purchased in its entirety by the local
retailer or by a customer located at the same connection point must be classified as a
non-market generating unit.

4.2 Policy

There are two aspects to the phrase purchased in its entirety that must normally be
demonstrated to AEMO for a generating unit to qualify as a non-market generating unit:

The first is that the local retailer or customer has an agreement to purchase all sent
out generation and the applicant demonstrates to AEMO by providing either a copy of
the agreement or a statutory declaration that there is such an agreement in place.

The second is that the local retailer or customer demonstrates to AEMO that its load
exceeds the output of the generating unit at all times under normal conditions.

For a customer, there would normally be sufficient load at the connection point of the
generating unit such that there is no export of electricity at the connection point under normal
conditions.
The local retailer must be able to demonstrate that the total of its local load exceeds the output
of the generating unit under normal conditions.
If the location of the generating unit is such that it causes some export to the transmission
system at a nearby transmission connection point, the generating unit may still be classified as
a non-market generating unit provided the total local load is sufficient.
If a local retailer has more than one generating unit connected within its local area, the sum of
the output of the non-market generating units must not exceed the local load. If the sum of the
generating units output exceeds the local load under normal conditions, the local retailer must
nominate which generating units are to be registered as non-market. The remaining
generating units must be registered as market generators.
AEMO considers that any electricity from the generating unit that flows to the network has
been delivered to the market and therefore the customer cannot claim that it has purchased
the electricity in its entirety. There must be a net purchase by the customer at that connection
point at all times under normal conditions.

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4.3

Meaning of normal conditions

Normal conditions means periods of operation without load shedding or other abnormal
events that would cause a reduction in the expected demand. This is intended to cover an
unexpected event that causes the local retailers local load or the customers load to fall below
the output of the generating system. AEMO can tolerate exports of electricity to the network
under these infrequent and unusual circumstances without requiring the generator to be
registered as a market generator.
There would need to be arrangements between the local retailer and either the generator or
the customer as to how they would account for any export under conditions other than
normal conditions.

4.4 Purchase by both customer and local retailer

Clause 2.2.5(a) of the Rules states that the sent out generation must be purchased in its
entirety by either the local retailer or a customer. In the case of a generating unit that supplies
a customer at the same connection point and is able to demonstrate that the electricity
exported to the market at the connection point is purchased in its entirety by the local retailer,
the generating unit may qualify as a non-market generator.

4.5 Meaning of at the same connection point

For a local retailer, the generating units to be registered must be connected within the local
area of that local retailer.
With respect to a customer, at the same connection point means that the load and the
generating unit effectively need to be connected in such a way that the metering installation
for the common connection point registers the net energy flow of the customer load and the
generator output. Transmission or distribution network equipment cannot be used to connect
the generating unit to the customers load.

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AEMOS POLICY ON CLASSIFICATION OF

GENERATING UNITS AS NON-SCHEDULED
GENERATING UNITS

5.1 Introduction

A generating unit with a nameplate rating of 30 MW or more, or that is part of a group of

generating units connected at a common connection point with a combined nameplate rating
of 30 MW or more, may be classified as a scheduled generating unit or a semi-scheduled
generating unit unless AEMO approves (under clause 2.2.3(b) of the Rules) that the
generating unit be classified as a non-scheduled generating unit.
Clause 2.2.3(b) of the Rules states:
A person must not classify a generating unit as a non-scheduled generating unit unless it has
obtained the approval of AEMO to do so. AEMO must approve the classification if it is satisfied
that:
1) the primary purpose for which the relevant generating unit operates is
local use and the aggregate sent out generation at its connection
point rarely, if ever, exceeds 30 MW; or
2) the physical and technical attributes of the relevant generating unit
are such that it is not practicable for it to participate in central
dispatch.

5.2 The Policy

AEMO will consider each application on its merits, and this Policy sets out the criteria that
AEMO will use to evaluate an application for classification as a non-scheduled generating unit.
This Policy assumes that the relevant generating unit is not eligible for exemption from
registration.
AEMO applies clause 2.2.3(b) as follows:

With respect to sub-clause (1):

AEMO considers the primary purpose to be local use if more than 50% of the capacity
of the generating unit or energy supplied from it (gross generation less generation
auxiliary load) is used locally. Note that, in any case, the sent out generation must rarely, if
ever, exceed 30 MW.

With respect to sub-clause (2):

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AEMO would need to examine, in each case, the physical and technical attributes of the
relevant generating unit. AEMO considers that the physical and technical attributes that
make it impractical to participate in central dispatch are:
o

the fuel or energy source for generation is dependent on some other industrial
process not related to electricity production; or

the generating unit is unable to vary output in response to a dispatch instruction for
some technical reason (other than fuel supply constraints).

5.3 Conditional approval

Clause 2.2.3(c) of the Rules states:

If, in relation to an application under paragraph (b), in AEMOs opinion it is necessary for any
reason (including power system security) for the relevant generator to comply with some of the
obligations of a scheduled generator or semi-scheduled generator for that generating unit,
AEMO may approve the classification on such terms and conditions as AEMO considers
reasonably necessary.
The terms and conditions of a classification of a scheduled generator that AEMO may
consider necessary include, but are not limited to:

Provision of ST PASA information (such as expected plant availability and PASA

availability) similar to that contemplated in clause 3.7.3(e).

Provision of MT PASA information (such as expected plant availability) similar to that

contemplated in clause 3.7.2(d).

Submission of dispatch information (such as expected MW capability) similar to that

contemplated in clause 3.8.2.

Compliance with dispatch instructions similar to that contemplated in clauses 4.9.2(b),

4.9.2(c) and 4.9.4(b) on reactive power dispatch.

The terms and conditions of classification of a semi-scheduled generator that AEMO may
consider necessary include, but are not limited to:

Provision of an energy conversion model similar to that contemplated in clause

2.2.7(c) (2).

Classification of two or more generating units as one semi-scheduled generating unit

similar to that contemplated by clause 2.2.7(i).

Compliance with dispatch instructions similar to that contemplated in clauses 4.9.2(b), 4.9.2(c)
and 4.9.4(b) on reactive power dispatch.

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GUIDE TO NEM GENERATOR CLASSIFICATION AND EXEMPTION

AEMO'S POLICY ON CLASSIFICATION OF A

GENERATING UNIT AS A SEMI-SCHEDULED
GENERATING UNIT

6.1 Introduction

A generating unit with a nameplate rating of 30 MW or more, or one that is part of a group of
generating units connected at a common connection point with a combined nameplate rating
of 30 MW or more, will be classified as a semi-scheduled generating unit where the output of
the generating unit is intermittent unless AEMO approves its classification as a scheduled
generating unit or a non-scheduled generating unit.

6.2 Policy

Intermittent is defined in Chapter 10 of the Rules:

A description of a generating unit whose output is not readily predictable, including, without
limitation, solar generators, wave turbine generators, wind turbine generators and hydrogenerators without any material storage capability.
AEMO will consider any alternative forms of intermittent generation as they are developed. In
considering alternative forms of generation, AEMO's consideration may include, but will not be
limited to:

Whether the output of the generating unit is unpredictable and any measures of
"unpredictability" you suggest.

The nature of the active energy input to the generating unit.

The timeframe of the variability of the output of the generating unit (taking into account
the 5-minute dispatch cycle).

Whether the generating unit can decrease output in response to a dispatch instruction.

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AEMOS POLICY ON GENERATORS

REGISTERING AS CUSTOMERS

7.1 Policy

AEMOs policy is:

A market generator may purchase electricity through the market provided both of the following
requirements are satisfied:

The electricity purchased is for operating the relevant generating system.

The generator only purchases the electricity from the market through the connection
point for a market generating unit. Where multiple connection points are involved, the
generator and the relevant network service provider must agree that the relevant
connection points pertain to the agreed point of supply between the network service
provider and the market generating unit.

This is based on clause 2.2.4(b) of the Rules, which implies that purchases under clause
2.2.4(d) relate to the activity of a market generating unit.

7.2 Examples of the application of the policy

There is a range of situations in which a generator consumes electricity. These are outlined in
the following diagrams and cover the following situations:
7.2.1

Single point of connection to the network

Figure 1: single point of connection to the network

TNSP ASSETS
Substation busbar

Market
generating
unit

Auxiliary Supply

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In this situation, the generator is taking its auxiliary supply before the transmission system.
Consumption through this connection point would only be likely when the generating unit is out
of service. In this case, the generator is not required to register as a customer. All purchases
under this situation would be covered by clause 2.2.4(d) of the Rules.

7.3 Multiple points of connection to the network

7.3.1

Local Connection

Figure 2: local connection

TNSP ASSETS
Substation busbar

Market
generating
unit

7.3.2

Auxiliary supply

Remote Connection

Figure 3: remote connection

TNSP ASSETS
Substation A busbar

NETWORK

Substation B busbar
Market
generatin
g unit

Auxiliary supply

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7.3.3

Local and Remote Connection

Figure 4: local and remote connection

TNSP
ASSETS

Substation A busbar

NETWORK

Market
generating
unit

Market
generating
unit
Auxiliary supply

Auxiliary Supply

Substation B busbar

Auxiliary supply

Auxiliary supply

In cases 7.3.1, 7.3.2, and 7.3.3, auxiliary supply for the market generating unit is taken from
physically separated connection points, either at the same substation, or from another point in
the network, or a combination of local and remote points.
As referred to in the Rules, a connection point can refer to multiple physical points. The
connection point is defined in Chapter 10 of the Rules as:
The agreed point of supply established between network service provider(s) and another
registered participant, non-registered customer or franchise customer.
Where the generator requires multiple points for a market generating unit, they must agree
with the network service provider that these points are the agreed points of supply. AEMO will
require written confirmation from both parties that such an agreement is reached.
In cases 7.3.1, 7.3.2, and 7.3.3, AEMO requires the generator to register as a customer and
classify the connection points that consume electricity as a market load unless:

The generator and the relevant network service provider confirm that all relevant
points are the agreed connection points for the market generating unit.

The electricity consumed through these additional connection points is within the
activity of operating the relevant generating system.

The consumption of electricity encompassed within the activity of operating a generating

system would be expected to cover such facilities as on-site offices, mines owned by the
generator, water pumping, conveyor belts and power station auxiliaries.

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7.4 Pump storage schemes

7.4.1

Single Point of Connection

Figure 5: single point of connection

TNSP ASSETS

Market
generating
unit

Pump

Where the market generating unit and pumping loads are connected at the one physical
connection point, the generator is not required to register as a customer and the electricity
consumed for pumping is deemed to be purchased under clause 2.2.4(d).
7.4.2

Multiple Points of Connection

Figure 6: multiple points of connection

TNSP ASSETS

NETWORK

Substation A busbar
Substation B busbar

Market
Generating
unit

Pump

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Where the electricity consumed in pumping is at a separate connection point, whether locally
or remote, the generator and the relevant network service provider will need to confirm that
the relevant points are the agreed connection points for the market generating unit. If such
agreement has been obtained, the generator does not need to register as a customer for the
pumping connection point.

7.5 Customer load other than that used in an activity associated

with the relevant generating system

7.5.1

Load within works - single connection point

Figure 7: single connection point

TNSP ASSETS

Market
generating unit

Substation busbar

LOAD

Where a customer has a substantial market generating unit within its works, in addition to load
not associated with the generation system via a single connection point, it is likely that the
generator will be required to register as a generator and a customer. There is a range of
possible scenarios from this configuration depending on whether the load is to be a market
load, second or first tier or a franchised load. Other variables relate to whether the generator is
to be market generator or non-market generator and whether it is connected to the
transmission system or embedded within a distribution system.

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7.5.2

Retail Supply

Figure 8: retail supply

Network

Market
Generator
Unit

Load

Where a generator also has an associated retail activity, it will be required to register as a
customer and classify all connection points related to its retail activities as market loads.
Clause 9.12.3 applies to the NSW Power Traders.

7.6 Impact of Connection Point Classification

Classification of a connection point as a market load or market generating unit connection

point has direct impact on:

prudential requirements

participant fees

jurisdictional charges

ancillary service payments

Transmission Use of System Charges (TUOS)

jurisdiction contestability levels

intervention and reserve trader arrangements

administered price cap compensation.

A customer is taken to be a market customer only where its activities relate to any market
load, and a generator is taken to be a market generator only where its activities relate to any
market generating unit.
The policy of requiring certain loads to be classified as a market load or a market generating
unit is primarily concerned with AEMOs reasonable assessment of the purpose for the
existence of those loads.

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7.6.1

Prudential requirements

AEMOs prudential policies only examine the net position of a market participant and thus the
classification of market load to a generator whose predominant activity is generation may not
require the generator to provide a prudential guarantee.
Where a generator is a predominant consumer, the net position will take the generation into
account. If a generator records a net import in a billing period, there may be a review of its
prudential requirements.
Only those market generators with a net settlement liability to AEMO will attract a positive
maximum credit limit. This is completely independent of the classification of the registered
participants connection points.
7.6.2

Participant fees

A generator that has a load that is classified as a market load (for example, where the
consumer is a person who is, or could be, registered as a second-tier customer), will be
charged relevant participant fees.
7.6.3

Jurisdictional charges

Any jurisdictional charge for a market load (settled by AEMO) will not be applied to loads at a
market generating unit connection point. Any jurisdictional charges that apply to market
customers would be expected to be levied against the market load of a generator or customer.
7.6.4

TUOS

TUOS charges are approved by the Australian Energy Regulator.

7.6.5

Jurisdictional contestability levels

Clause 2.3.1(e) of the Rules requires that a connection point must satisfy the requirements of
participating jurisdictions before it can be classified as a load. Therefore, it is appropriate that
where a generator is required to register as a customer and classify any connection points as
a market load, evidence is provided of their satisfaction of jurisdictional requirements. One
jurisdictional requirement is that contestability limits be met. A generator with loads classified
as a market generating unit connection point is not required to demonstrate to AEMO that the
load meets contestability limits.
7.6.6

Intervention and reserve contract

In the case of intervention and reserve contracts, payments will be made to generators and
charges made to market customers in respect of those connection points classified as market
generating units or market loads, respectively.
7.6.7

Administered price cap compensation (clause 3.14 of the Rules)

Administered price cap compensation is funded by all market customers in proportion to the
amount of the metered market load. Generators will not pay with respect to loads classified as
market generator connection points.

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FUEL SOURCE AND TECHNOLOGY TYPE

8.1 Introduction

To allow publishing of this information, the fuel source and technology of all generating units
must be submitted in the registration application. A list of common fuel source and technology
types is provided in this section.
8.1.1

Fuel source types

Table 2: common fuel source types

Primary Fuel Source

Descriptor

Renewable/Biomass/Waste

Bagasse
Biodiesel
Biofuel - other
Biogas - other (captured for combustion (not methane))
Biogas - Sludge (captured for combustion (methane only))
Biomass recycled municipal and industrial materials
Dry wood
Ethanol
Green and air dried wood
Landfill methane / Landfill gas

Fossil

Black coal
Blast furnace gas
Brown coal
Brown coal briquettes
Charcoal
Coal seam methane
Coal tailings
Coke oven coke
Coke oven gas
Crude oil and condensates
Diesel
Ethane
Fuel Oil
Gaseous fossil fuels - other
Gasoline (aviation fuel used for stationary energy) - avgas
Gasoline (non-aviation fuel)

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Heating oil
Kerosene (aviation fuel used for stationary energy) avtur
Kerosene (non-aviation fuel)
Liquefied aromatic hydrocarbons
Liquefied petroleum gas
Naphtha
Natural gas compressed
Natural gas liquefied
Natural gas unprocessed
Natural gas (pipeline)
Natural gas/diesel
Natural gas/fuel oil
Natural gas liquids other
Petroleum based greases
Petroleum based oils and lubricants
Petroleum based products other
Petroleum coke
Recycled fossil fuel derived industrial and municipal materials
Refinery coke
Refinery gas and liquids
Solid fossil fuels other
Solvents if mineral turpentine or white spirits
Sulphites lyes
Tar
Town gas
Waste coal mine gas
Hydro

Water

Geothermal

Geological heat

Solar

Solar

Wave

Water

Wind

Wind

Tidal

Water

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8.1.2

Technology types

Table 3: common technology types

Primary Technology

Descriptor

Renewable

Hydro - Gravity
Run of River
Pump Storage
Tidal
Wave
Wind - Offshore
Wind - Onshore
Photovoltaic Flat panel
Photovoltaic Concentrator
Photovoltaic Tracking Flat panel
Photovoltaic Tracking Concentrator
Solar Thermal
Boosted Solar Thermal
Solar Thermal with Storage
Boosted Solar Thermal with storage
Enhanced Geothermal Systems (Hot Dry Rock)/Flash

Combustion

Compression Reciprocating Engine

Spark Ignition Reciprocating Engine
Combined Cycle Gas Turbine (CCGT)
Open Cycle Gas turbines (OCGT)
IDGCC (Integrated Drying and Gasification Combined Cycle)
IGCC (Integrated Gasification Combined Cycle)
Integrated CTL (Coal to Liquid)
Steam Sub Critical
Steam Super Critical

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AEMO January 2014

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