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$9M saving for client with the implementation of self-forecasting system

by RES | Apr 04, 2022 | Reading time: < 1 min

In Australia, the market operator AEMO forecasts and schedules who is generating electricity and how much they’re expected to generate every five minutes. To further ensure that supply and demand remains balanced and stable, AEMO purchases a regulation service from certain generators – this is called Regulation Frequency Control Ancillary Services (R-FCAS). 

R-FCAS provides an injection of energy into the grid if frequency drops below 50 Hz to restore balance when required (and vice versa). The cost of this service is apportioned to participants using a complicated formula which attempts to quantify how much the participant contributed to the need for the service, ie the “Causer Pays Procedure”. FCAS fees have become extreme and a major pain point for generators. If a generator does not hit their targets (if they’re producing too much or too little electricity), they are likely to incur a higher “Causer Pays” fee.

Since early 2019, AEMO has allowed generators to submit their own 5-minute generation forecast – thereby providing an opportunity to reduce their Causer Pays charges. A RES asset management team can review the self-forecasting market and implement the appropriate and most effective generation forecasting system for your project, to help you to avoid (or at least materially reduce) these charges. 

A 100MW+ Australian solar farm managed by RES has seen the impressive benefits of a RES-implemented self-forecasting system. The project saw losses of $30-40K per month reduced to only a few hundred dollars. This will result in a $9M saving for the client over the lifetime of the project. 

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