Frequency Control Ancillary Services

Why frequency control matters

The National Electricity Market runs at 50 Hz. Maintain that, and appliances work correctly, generators stay synchronised, and the system is stable. Deviate too far - say to 47 Hz or 52 Hz - and protective relays start tripping, generators disconnect, and the cascade can become a blackout.

Frequency drops when there’s more load than generation (demand exceeds supply). It rises when generation exceeds load. FCAS services are the mechanisms AEMO uses to keep frequency within acceptable bands by dispatching resources that can inject or absorb power rapidly.

The FCAS categories

AEMO procures eight distinct FCAS services, differentiated by response speed and direction:

Raise services - inject power to arrest a frequency drop:

• Fast raise (respond within 6 seconds)
• Slow raise (60 seconds)
• Delayed raise (5 minutes)

Lower services - absorb power to arrest a frequency rise:

• Fast lower, slow lower, delayed lower

Plus contingency fast raise and contingency fast lower for major events.

Batteries excel at fast services because they respond in milliseconds - far faster than a gas turbine ramping up or a hydro unit adjusting its gates.

How batteries earn FCAS revenue

A battery providing FCAS is essentially being paid to stand ready to respond. In many cases, the battery doesn’t actually discharge much - it holds state of charge near a midpoint and moves up or down slightly as frequency demands. The payment is for availability, not necessarily delivered energy.

For grid-scale batteries, FCAS revenue has proven significant. Neoen’s Hornsdale Power Reserve (the original “Tesla Big Battery” in SA) earned more revenue from FCAS in its first year than from energy arbitrage. This partly drove the wave of large-scale battery investment across Australia from 2018 onwards.

For home batteries through VPPs: most current VPP schemes don’t pay individual households explicitly for FCAS - the aggregator captures that revenue and shares some back as bill credits. As VPP markets mature and AEMO refines its DER participation frameworks, direct household FCAS participation is technically possible but not yet widespread.