Could AEMO's cautious grid planning be costing you money? Australia's electricity market operator has been warned that an overly cautious approach to planning the grid could leave consumers paying more than necessary. That's one of the findings of an independent review of the Australian Energy Market Operator (AEMO), which has also raised concerns about potential conflicts between some of the organisation's expanding responsibilities. Energy ministers have agreed to reforms aimed at addressing both issues. Why could caution cost consumers? Keeping the lights on is AEMO's day job, so being cautious about the future electricity system might sound like a good thing. The problem is that caution can be expensive. AEMO develops the Integrated System Plan (ISP), which maps out the generation, storage and transmission infrastructure needed as Australia's electricity system changes. The review, led by former senior Treasury official Nigel Ray, found AEMO's responsibility for maintaining system reliability and security gives it a naturally conservative approach to risk. But it warned: "This approach has cost consequences for consumers if that caution brings forward investment or overstates required intervention." That matters because the ISP can identify major transmission projects as "actionable". The review says that status is difficult to unwind and can commit consumers to significant, long-lived regulated expenditure. Those network costs are ultimately recovered from electricity consumers. The review does not conclude AEMO has been unnecessarily building infrastructure or wasting consumers' money. Instead, it identifies a risk in the way planning decisions are made. Could solar and batteries help keep grid costs down? Rather than taking long-term planning away from AEMO, the review wants changes to the rules governing the ISP. Among them is greater consideration of the demand side - how electricity consumers and resources connected to distribution networks can help meet the needs of the system. The review says greater innovation, including on the demand side and at distribution level, could reduce reliance on costly and time-consuming grid-scale infrastructure and minimise the overall cost of the energy transition. That potentially includes the growing fleet of rooftop solar systems, home and community batteries, electric vehicles and flexible loads. Energy ministers have agreed, with the ISP rules now under review. And then there's A potential conflict of interest. Consumer costs weren't the only concern to emerge from the review. AEMO also controls AusEnergy Services Limited (ASL), which carries out energy investment procurement work for governments. That creates an unusual arrangement. AEMO operates the electricity system and helps determine through its planning what the future system needs, while its subsidiary is involved in procuring energy investment. The review found ASL's investment procurement role did not align with AEMO's core functions, creating differing mandates and "perceived conflicts of interest". The proposed solution is simple: separate them. Energy ministers have agreed ASL should be spun out as a standalone organisation. That hasn't happened yet. Senior officials still need to work out the implementation and timing, in consultation with ASL, its existing members and potential future members. Who's watching AEMO's own spending? The review also turned its attention to what AEMO itself costs to run. Its budget has nearly tripled over five years, although AEMO estimates its NEM functions currently add only around $16 a year to an average residential electricity bill. The bigger governance problem identified by the review is the lack of binding independent external scrutiny of whether AEMO's expenditure is efficient. Energy ministers have agreed in principle to give the Australian Energy Regulator a new role overseeing AEMO's annual budget. AEMO has welcomed the review and begun work on the recommendations that fall within its control. For households, however, the more consequential reform may be changes to the way AEMO decides what future grid infrastructure is needed. Australia needs enormous investment in its electricity system over the coming decades. The review isn't arguing against that investment. It's asking whether consumers can be better protected from paying for infrastructure earlier than necessary - or when a cheaper solution could do the job. And with more solar, batteries and flexible loads appearing behind the meter, what consumers can contribute to the grid may increasingly matter just as much as what gets built in front of it. AEMO's recent analysis of 20,000 Australian homes shows just how much difference home batteries are already making to when households rely on the grid.

AEMO appoints 2028 ISP Consumer Panel. 14/05/2026 The Australian Energy Market Operator (AEMO) is pleased to announce the appointment of the 2028 Integrated System Plan (ISP) Consumer Panel, an independent advisory body that provides a consumer-focused perspective on Australia's long-term energy planning. AEMO has appointed Michael Swanston (Chair), Dr Jarra Hicks, Dr Edward Langham and Georgina Morris as members of the 2028 ISP Consumer Panel to engage with AEMO and represent consumers throughout the development of the 2028 ISP. Dr Hicks is continuing with the Panel for a second term; the other three panellists are newly appointed. Profiles of each of the panel members are available here. AEMO extends its thanks to outgoing ISP Consumer Panel members Mark Henley (Chair), Beverley Hughson and Craig Memery for their exceptional contributions to the development of both the 2024 ISP and 2026 ISP during the past four years. The Panel's primary focus to date in 2026 has been responding to the Draft 2026 ISP, outlining more than 50 recommendations covering 12 major recurring themes in their 90-page report. ISP Consumer Panel members have broad experience across Australia's energy sector, including transmission, distribution, generation, storage, regulation and consumer energy resources. The Panel plays a critical role in the ISP two-year development process, through preparing formal reports at key milestones and undertaking regular engagement with AEMO. "The ISP Consumer Panel has an important role in making sure the perspectives of households, communities and businesses remain central to long-term energy planning. Australians will ultimately fund and rely on the energy system being developed through the ISP process, so it is critical that decisions are practical, transparent and grounded in the long-term interests of consumers. I'm honoured to chair the Panel and work alongside members to provide constructive, balanced input to AEMO as the ISP develops. Good planning must recognise the very real pressures consumers are facing on energy costs, while also supporting a system that is reliable, secure and capable of meeting Australia's future energy needs," 2028 ISP Consumer Panel Chair Michael Swanston says. The 2026 ISP Consumer Panel will remain in place until the publication of the 2026 ISP in June. Recruitment for the 2028 ISP Consumer Panel followed a call for expression of interest in February 2026. The EOI generated close to 30 high-calibre applications with varying expertise, and AEMO thanks all who applied. About the ISP. The ISP sets out the least-cost investment pathway for the National Electricity Market (NEM) to meet consumer energy needs and government policies through to 2050. The ISP is published at least every two years. Further information about the ISP is outlined in AEMO's Integrated System Plan toolkit. AEMO consults with a wide range of stakeholders, including energy consumers and community advocates. The toolkit provides essential information about the ISP to help these groups understand it more and learn how they can contribute to its development.

Synchronous condensers to play key role in system security says AEMO. The Australian Energy Market Operator says "timely investments" are essential to unlock the full value of renewables and reduce reliance on coal generators for system security as the nation's clean energy transition continues. The Australian Energy Market Operator (AEMO) has released the 2025 Transition Plan for System Security outlining key points and the investments required to maintain system security in the National Electricity Market (NEM) over the next decade. AEMO Chief Executive Officer Daniel Westerman said the expanded report provides technical information to navigate the next 10 years of the transition to meet system security requirements and consumer needs. "The Transition Plan for System Security aims to help guide the sector through the next phase of the energy transition, focusing on the key transition points and actions needed to keep Australia's main power system stable and secure," he said. "The report outlines the steps required to replace the system security services provided by coal plants that are retiring and unlock the growing potential of renewable energy, including rooftop solar, to help deliver a smooth transition for consumers," he said. Westerman said 10 coal-fired power stations have closed since 2012 and half of the remaining fleet is projected to retire in the coming 10 years, as well as several large gas generators. These power plants are being replaced by a pipeline predominantly made up of inverter-based resources (IBR), such as solar, batteries, and wind generation, including a large amount of distributed solar and batteries. "Australia's energy system is changing rapidly. Coal-fired power stations are retiring and being replaced with a combination of renewable energy, storage and gas-powered generators," Westerman said. "Australian consumers continue to invest in rooftop solar at a world leading pace and they are now adding home batteries and electric vehicles." Westerman said that flood of intermittent generation can sometimes create a challenge for how the system operates, adding that it is essential that the NEM remain both reliable and secure. "To be reliable, there must be enough generation to meet consumer needs at any point in time," he said. "To be secure, the power system must operate safely within its defined technical limits, withstand disturbances, and be able to restart in the event of a widespread outage." Key to AEMO's plan is the timely delivery of synchronous condensers capable of providing both system strength and inertia. The market operator also highlighted the need for grid-forming battery energy storage systems to deliver a wide range of system security services in the NEM such as frequency control, voltage stability and some aspects of system strength. AEMO also warned that there is a need for increased emergency distributed PV backstop capacity, particularly in Queensland, to keep the grid stable during periods of low demand. These "backstop" measures would give the market operator the ability to switch off or turn down rooftop solar systems in "rare, but plausible" operating conditions. "The last decade has seen significant effort to support the transition to greater amounts of large-scale renewables, including improved performance standards and new operational approaches to maintain system security and reliability," the report reads. "A similar concerted effort is required to ensure consumer energy resources are effectively integrated in a way that supports the secure and reliable delivery of electricity to all consumers now and into the future." Westerman noted that industry and governments already have actions underway to manage the identified transition points and said AEMO will continue to work collaboratively to signal and support the required investments and reforms needed to maintain system security. "For decades, system security services have been a by-product of coal-fired power generation," he said. "As these aging generators withdraw and retire, replacement services must be delivered on time to support higher levels of renewable energy produced by residential rooftops and commercial scale generators." This content is protected by copyright and may not be reused. If you want to cooperate with pv magazine Australia and would like to reuse some of its content, please contact: [email protected]. David carroll. David is a senior journalist with more than 25 years' experience in the Australian media industry as a writer, designer and editor for print and online publications. Based in Queensland - Australia's Sunshine State - he joined pv magazine Australia in 2020 to help document the nation's ongoing shift to solar.