The Australian Energy Regulator (AER) has instituted proceedings in the Federal Court against Callide Power Trading Pty Ltd (Callide Power Trading) for failing to comply with its performance standards for the Callide C power station.
On the afternoon of 25 May 2021, an incident occurred involving the trip of multiple generators and high voltage transmission lines in Queensland following an initial event at the Callide C power station. This resulted in the loss of approximately 3,045 MW of generation and 2,300 MW of customer load being disconnected from the power system resulting in widespread blackouts to households and businesses across Queensland.
After conducting a thorough investigation, the AER alleges that Callide Power Trading, the Registered Participant for Callide C, breached rule 4.15(a)(1) and clause 5.2.5(a)(1) of the National Electricity Rules in respect of the Callide C4 generating unit by failing to ensure its plant met or exceeded applicable performance standards, and by failing to plan and design its facilities and ensure they were operated to comply with those performance standards.
The failure of Callide C4’s protection systems to disconnect the generating unit from the power system resulted in the trip of multiple generators. Callide C4 has been offline since the incident.
AER Board Member Mr Justin Oliver said compliance with generator performance standards is critical to the safe and secure operation of the power system, and is one of the AER’s compliance and enforcement priorities.
“Performance standards describe how a generating unit should perform and how it should respond to adverse events. These standards are agreed between the Registered Participant and the Australian Energy Market Operator.”
“Failure to comply with these standards can risk power system security, see consumers disconnected from power supply and cause wholesale energy prices to increase during and beyond these events.”
“It’s vital that Registered Participants and Generators are aware of their performance standards and comply with them at all times so that the market and consumers aren’t wrongly exposed to the consequences of adverse events,” Mr Oliver said.
The AER is seeking pecuniary penalties, declarations, orders for remedying the breach or preventing the recurrence of the breach, and costs.
Note to Editors
Concise statement
AER v Callide Power Trading Statement 9 February 2024.
The document contains the AER’s initiating court documents in relation to this matter. We will not be uploading further documents in the event these initial documents are subsequently amended.
As the matter is now before the Court, the AER will not be making any further comment.
25 May 2021 power system incident report
The Australian Energy Market Operator published its report into the 25 May 2021 power system incident in October 2021.
Alleged conduct
The AER alleges that CPT failed to ensure that Callide C4 complied with its generator performance standards as follows.
- National Electricity Rules cl S5.2.5.9 – Protection that impacts Power System Security. The AER alleges that Callide C4’s protection systems did not have sufficient redundant power supply to disconnect the generating unit from the power system when the faults occurred.
- National Electricity Rules cl S5.2.5.10 – Asynchronous Operation. The AER alleges that Callide C4 did not have a protection system to promptly disconnect it in the event of pole slipping. Pole slipping is when forces within a generator can no longer keep it spinning in line (or synchronised) with all other generators in the system. If left unresolved, these conditions can lead to severe damage to the generator and with significant disruption to the rest of the power system.
Previous AER enforcement action related to the 25 May 2021 power system incident
As part of its investigation into the 25 May 2021 power system incident, the AER issued an infringement notice imposing a penalty of $67,800 to CS Energy Limited for allegedly operating a generating system without the required regulatory approval, which has since been paid.
The AER also issued six infringement notices totalling $263,400 to Stanwell Corporation Limited for allegedly applying an unapproved protection setting to three of its generating units at Stanwell Power Station and for failing to ensure those units met the required generator performance standard for voltage disturbances, which has since been paid.
The AER’s Compliance & Enforcement Priorities
Improving market participants’ compliance with performance standards and standards for critical infrastructure is one of the AER’s five current Compliance & Enforcement Priorities.