Energy in Australia
Energy-in-Australia-2015
Energy-in-Australia-2015
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Structure of the <strong>Australia</strong>n<br />
Electricity Market<br />
The <strong>Australia</strong>n electricity market is made up of three separate large-scale<br />
systems: the National Electricity Market (NEM), the Western <strong>Australia</strong>n<br />
Market, and the Northern Territory Market. These markets are dist<strong>in</strong>ct from<br />
one another due to their geographical separation and the high costs of<br />
transport<strong>in</strong>g electricity over such distances.<br />
In each market, electricity is generated by generators and this electricity<br />
is sent out via transmission networks to electricity distributors and largescale<br />
end users, such as large <strong>in</strong>dustrial facilities. Electricity distributers<br />
then distribute electricity to smaller-scale end users, <strong>in</strong>clud<strong>in</strong>g residential,<br />
commercial and <strong>in</strong>dustrial. Electricity retailers buy electricity <strong>in</strong> wholesale<br />
markets and sell it to end users, packaged to <strong>in</strong>clude the costs of<br />
generation, transmission and distribution, and the retail services.<br />
National Electricity Market (NEM)<br />
The NEM refers to both the wholesale market <strong>in</strong> which electricity is traded,<br />
and the physical <strong>in</strong>terconnected electricity grid of the eastern states.<br />
The grid extends from Port Douglas <strong>in</strong> Queensland, through New South<br />
Wales, the <strong>Australia</strong>n Capital Territory, Victoria and Tasmania, and across<br />
to Port L<strong>in</strong>coln <strong>in</strong> South <strong>Australia</strong>, connected by six major transmission<br />
<strong>in</strong>terconnectors and approximately 804,000 kilometres of transmission<br />
and distribution l<strong>in</strong>es.<br />
The <strong>Australia</strong>n <strong>Energy</strong> Market Operator (AEMO) is responsible for the<br />
operation of the NEM. AEMO schedules electricity to be dispatched from<br />
specific generators to create a gross energy pool, which is then sent out<br />
<strong>in</strong> order to meet demand.<br />
Western <strong>Australia</strong><br />
There are two large electricity markets <strong>in</strong> Western <strong>Australia</strong>: the North<br />
West Interconnected System (NWIS) and the South West Interconnected<br />
System (SWIS). The two systems are not connected electronically.<br />
The NWIS network consists of about 8,000 kilometres of transmission and<br />
distribution l<strong>in</strong>es and covers an area of approximately 2.3 million square<br />
38 ENERGY IN AUSTRALIA 2015