Snowtown 2 to pay penalty of $1 million for rule breach

Snowtown Wind Farm Stage 2 (Snowtown 2) has been ordered to pay $1 million in penalties by the Federal Court for failing to provide critical information to the Australian Energy Market Operator (AEMO) and network service provider ElectraNet, in breach of the National Electricity Rules.

AER Chair Clare Savage said the AER took conduct that affects system security extremely seriously.

“As wind farms make up an increasing proportion of our generation mix, it is more important than ever that they comply with the National Electricity Rules,” she said.

Last year the AER brought proceedings in the Federal Court against four wind farm operators in South Australia (SA) including Snowtown 2 for alleged breaches of the National Electricity Rules.

The proceedings came after an investigation by the AER into the circumstances of the Black System Event which resulted in loss of power to 850,000 customer connections across SA on 28 September 2016.

Snowtown 2 admitted that, from September 2013 to October 2016, it failed to obtain written approval from AEMO and ElectraNet for the repeat low voltage ride through (LVRT) system settings.

Generators are required to operate their plants in line with Generator Performance Standards in agreement with AEMO. The standards describe how their systems will perform if adverse events occur, and the data is critical to AEMO in operating the power network safely and reliably.

Following the admissions from Snowtown 2, the Federal Court declared that by failing to obtain written approval from AEMO and ElectraNet for the repeat LVRT settings in place at its windfarm, Snowtown 2 breached the National Electricity Rules.

In his judgment, The Hon. Justice R C White stated that the contravention by Snowtown 2 was serious. “Use of non-approved settings in the present case comprised AEMO’s ability to discharge its responsibility. As the events of 28 September 2016 indicate, a compromise of the security of the power system can have extensive and serious consequences,” he said.

“This penalty outcome sends a strong message to all generators that the AER will take court action when necessary to enforce the National Electricity Rules,” Ms Savage said. 

Snowtown 2 cooperated with the AER, by admitting liability and making joint submissions with the AER to the Court. 

The Court also ordered Snowtown 2 to pay a contribution of $100,000 towards the AER’s costs, and to implement a compliance program to ensure compliance with the National Electricity Rules.

Snowtown 2 has also provided, and the AER has accepted, an Enforceable Undertaking in which Snowtown 2 acknowledges the AER’s concerns in relation to its failure to ride through the voltage disturbances on the day of the Black System Event, and undertakes to engage an independent expert to review its current settings to ensure its Generator Performance Standards expressly provide for the operation and settings of its repeat LVRT protection system.

A wind turbine’s repeat LVRT protection system is triggered if a certain number of disturbances are detected within a specific time frame. Once a generating unit’s repeat LVRT protection system is triggered, that wind turbine ceases to generate and supply active power to the power system.

Note to Editors

Proceedings are continuing in the Federal Court against the three other windfarm operators, who are subsidiaries of AGL Energy Limited (ASX: AGL), Neoen SA, and Pacific Hydro Pty Ltd.

The provision of timely and accurate information to AEMO is an enforcement and compliance priority for the AER.

About the AER

The Australian Energy Regulator (AER) works to make all Australian energy consumers better off, now and in the future. 

  • We regulate electricity networks and covered gas pipelines, in all jurisdictions except Western Australia. We set the amount of revenue that network businesses can recover from customers for using these networks.
  • We enforce the laws for the National Electricity Market and spot gas markets in southern and eastern Australia. We monitor and report on the conduct of energy businesses and the effectiveness of competition.
  • We protect the interests of household and small business consumers by enforcing the Retail Law. Our retail energy market functions cover New South Wales, South Australia, Tasmania, the ACT and Queensland.
  • We drive effective competition where it is feasible and provide effective regulation where it is not. We equip consumers to participate effectively, including through our Energy Made Easy website, and protect those who are unable to safeguard their own interests. We use our expertise to inform debate about Australia’s energy future.
Sector: 
Segment: 
Issued date: 
22 December 2020
AER reference: 
NR 49/20
Contact: 
AER Media 0466 409 921 media@aer.gov.au