The South West Interconnected System (SWIS) in Western Australia is undergoing transformation driven by the uptake of renewable energy technologies.
In June 2025, Energy Policy WA (EPWA), (now within Department of Energy and Economic Diversification), in consultation with the Market Advisory Committee (MAC), released the Power System Security and Reliability (PSSR) Standards Review – Consultation Paper.[1] This paper outlines proposed reforms aimed at establishing a consistent, single, end-to-end PSSR Standard for the SWIS under a centralised governance framework. It is to be implemented within the Electricity System and Market Rules (ESM Rules).
These proposed reforms will address the existing regulatory complexities, duplications, gaps, and inconsistencies that have historically posed challenges for the efficient and timely grid connection of new energy technologies. The consultation period is open until 31 July 2025.
The reforms and the renewable energy projects
The current PSSR Standards framework for the SWIS is fragmented across various instruments, including the ESM Rules, Western Power’s Technical Rules, the Electricity Industry (Network Quality and Reliability of Supply) Code 2005 (NQRS Code), and the Electricity Networks Access Code 2004 (ENAC). This fragmentation creates inefficiencies and delays in integrating modern inverter-based resources (IBRs) such as solar, wind, and battery energy storage systems (BESS).
The PSSR Standards Review is being conducted to implement the Energy Transformation Taskforce’s recommendation for a single, consistent, end-to-end PSSR Standard for the SWIS, governed centrally.
This initiative seeks to:
- Streamline roles and responsibilities for managing power system security and reliability.
- Ensure end-to-end consistency as standards are established or modified.
- Balance economic factors, customer needs, and state development goals in the evolution of PSSR Standards.
- Enable new technologies (such as Distributed Energy Resources (DER) and Electric Storage Resources (ESR)) to efficiently integrate and contribute to system flexibility.
Key proposals and their impact on renewable energy development
The consultation paper presents twenty key proposals, many of which carry direct and significant implications for renewable energy project developers and investors.
1. A new user facility standards framework (Proposals 2, 3, 4)
The paper proposes a revised facility categorisation framework to be implemented in the ESM Rules. This framework will comprise of four categories:
| User categorisation framework | Application of standards | |
| Large User Technical Standards | Energy Producing Systems (including ESR) greater than 10 Megavolt Amperes (MVA), and Synchronous Condensers, connected to the High Voltage (HV)/Medium Voltage (MV) network. | These will be subject to the current ESM Rules Appendix 12 standards (subject to later proposals), allowing for negotiation between Automatic User Performance Standards (formerly Ideal Generator Performance Standards) and Minimum User Performance Standards. |
| Medium User Technical Standards | For Energy Producing Systems (including ESR) 10 MVA or less, connected to HV/MV Network. | These will follow Common Requirements and Minimum User Performance Standards, with no ability to negotiate below these standards. |
| Loads | All loads other than stand-alone ESR. | These will be subject to requirements aligned with section 3.4 of the 2023 proposed Technical Rules with no ability to negotiate. |
| Small User Technical Standards | For low voltage connected equipment. | These will be subject to requirements aligned with sections 3.7 and 3.8 of the 2023 proposed Technical Rules. |
This re-categorisation utilises MVA instead of MW for capacity assessment to better account for reactive power support. This can significantly influence investment decisions for new facilities. The objective is to manage PSSR risks without imposing onerous technical requirements on proponents.
Further, the framework clarifies the point of compliance with user facility standards. While compliance will generally be assessed at the Connection Point, the Network Operator will be required to document circumstances where an alternative point is needed, providing more certainty to proponents. Hybrid facilities (e.g., a large load with co-located energy producing system) with robust control and protection systems that prevent PSSR impact on the wider system will be treated as loads, avoiding the more stringent requirements for energy producing facilities. This flexibility encourages diverse energy solutions.
2. Suitability of Technical Requirements (Connection Standards) for New Technologies (Proposals 6, 7, 8, 9, 10, 11)
The reforms include the proposal of updating connection standards to better suit IBRs, particularly grid-forming (GFM) and grid-following (GFL) inverters. This is because operational experience has shown that the current Appendix 12 of the ESM Rules present difficulties for some newer technologies to meet the Technical Requirements, resulting in their inability to connect at the Automatic Performance Standard.
3. A robust SWIS System Strength Framework (Proposals 12, 13, 14, 15)
One of the most significant changes for future renewable energy projects is the proposed SWIS System Strength Framework. This framework aims to move away from a “connect and manage” approach towards centralised and proactive planning and investment to ensure sufficient system strength for a future grid dominated by IBRs.
Key components include:
- A revised definition of ‘System Strength’ that captures both locational considerations and the ability to resist voltage waveform changes during steady state and disturbances.
- A requirement for AEMO, EPWA, and the Network Operator to align on a 10-year generation and ESR capacity outlook to inform fault level assessments, providing greater planning certainty for all stakeholders.
- An obligation for the Network Operator to forecast and maintain minimum fault levels for network protection, with a transparent methodology.
- A centralised planning/investment function for system strength. The Network Operator will forecast shortfalls in system strength needed to host expected IBRs and procure services competitively (using the Non-Co-optimised Essential System Services (NCESS) framework) to address these. This is expected to ‘unlock constraints on cheaper forms of generation or ESR that may otherwise not enter the market’ and achieve the ‘lowest whole of system cost’.
4. Broader governance and transparency (Proposals 5, 16, 19)
The consultation paper also proposes significant improvements in governance and transparency. Negotiated user standards for future connections will be made public, fostering greater transparency and facilitating future negotiations between users and the Network Operator/AEMO. A collaborative process between forecasting parties (EPWA, AEMO, Network Operator) will be established to ensure consistency in inputs and assumptions, allowing for a more flexible and adaptive approach to problem-solving. The proposed governance arrangements also align with the Energy Transformation Taskforce’s recommendations for a centralised PSSR Standards framework under the Coordinator of Energy.
Outlook for the renewable energy industry
These proposed reforms represent a critical step forward for the renewable energy industry in Western Australia. By standardising requirements, enhancing technical specifications for new technologies, and adopting a proactive approach to system strength, DEMIRS aims to:
- Reduce complexity and uncertainty in the connection process.
- Accelerate the integration of new renewable generation and storage into the SWIS.
- Unlock further investment by providing greater clarity and predictability for developers.
- Ensure the long-term security and reliability of the power system as it transitions to a higher share of inverter-based resources.
Stakeholder consultation
These developments in Western Australia provide valuable insights for renewable energy projects across Australia, highlighting the evolving regulatory landscape necessary to support the energy transition. Stakeholders in the renewable energy sector are strongly encouraged to actively participate in the consultation process, which closes at 5:00 PM (AWST) on 31 July 2025.
119 June 2025.
