Frequency Performance Payment Penalties
Definition
AEMO's new double-sided FPP mechanism penalizes assets destabilizing grid frequency every 5 minutes, with costs recovered from poor performers to reward stabilizers, creating direct financial losses for non-compliant participants.
Key Findings
- Financial Impact: AUD penalties recovered every 5 minutes per poor performance event; costs of FCAS services co-optimized in 5-min intervals (up to thousands AUD daily for large assets)
- Frequency: Every 5 minutes during operations
- Root Cause: Inaccurate real-time frequency control leading to negative contribution factors
Why This Matters
The Pitch: Electric Power Transmission players in Australia 🇦🇺 face ongoing FPP penalties for poor real-time grid balancing. Automation of frequency response eliminates this risk.
Affected Stakeholders
Grid operators, Generators, Battery operators, Large industrial loads
Deep Analysis (Premium)
Financial Impact
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Current Workarounds
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Methodology & Sources
Data collected via OSINT from regulatory filings, industry audits, and verified case studies.
Related Business Risks
FCAS Availability and Enablement Costs
Grid Instability Outages
Incident Response Remediation Costs
Operational Downtime from Cyber Events
Capacity Loss from Failed Demand Response Events
Delayed Verification and Payment Drag in DR Administration
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