CS Energy has paid penalties totalling $200,000 for its alleged failure to ensure it was able to supply frequency control ancillary services (FCAS), as had been offered to the market.
FCAS helps manage the stability of the power system and therefore prevent disruption of electricity supply to customers, in this case, Queensland customers.
CS Energy has also repaid $1.13 million to the Australian Energy Market Operator (AEMO) it received as payment to provide the services.
The Australian Energy Regulator (AER) requested CS Energy to make this repayment because it was not capable of complying with the FCAS offers it submitted to AEMO.
AER Chair, Clare Savage, said it was a basic principle that businesses should not keep payment for services they are unable to deliver in line with their offers.
“Inaccurate information about FCAS offers undermines AEMO’s ability to manage frequency deviations that are critical to supporting the integrity of the power grid,” Ms Savage said.
“CS Energy and other FCAS providers must have robust systems and processes in place to ensure it is at all times able to comply with its FCAS offers and that customers pay only for services that are provided.
“The AER will continue to monitor FCAS providers and take action against businesses who do not comply with these crucial obligations.”
CS Energy allegedly failed to ensure it was at all times able to comply with its contingency FCAS offers at certain units at Callide B power station on 25 August 2018 and Gladstone power station in November 2019 and January 2020.
CS Energy was not capable of complying with its offers due to settings at certain units at the power stations.
CS Energy has made changes to its processes and systems so that it does not make offers for contingency FCAS at Callide B and Gladstone power stations when these settings are in place.