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AGL faces big fines over 2016 wind farm failure

The operators of four wind farms in South Australia during the 2016 statewide blackout face fines of $3.5 million in a proposed settlement for breaching national electricity rules.

The Hallett wind farms, operated by companies wholly owned at the time by power generator AGL, had failed to obtain written approval from the network operators for critical settings designed to allow their wind turbines to ride through disruptions to the electricity grid.

In action brought by the Australian Energy Regulator, the Federal Court heard on Friday that while the failure to obtain approval was inadvertent, the settings applied were insufficient to cope with the disruptions to the network during the black system event.

At the time, the turbines were set to ride through three low-voltage disturbances within a two-minute period.

Ruth Higgins SC, for the AER, told the court that three months after the blackout the settings were revised, with the approval of the Australian Energy Market Operator, to allow turbines to cope with seven low-voltage events in quick succession before reducing power or turning off.

Dr Higgins said these changes would have allowed the turbines to continue to operate despite the disruptions caused at the time of the blackout.

Cameron Moore, for AGL, said the company conceded its failures in regard to the wind farm settings compromised AEMO's ability to ensure the resilience of the power grid.

But he said it denied, and the AER did not contend, that its systems were a contributing cause of the blackout.

Mr Moore said it also remained unknown as to whether AEMO would have approved its original settings, considering the chance of three under-voltage events caused by three transmission lines being severely affected was "almost an unheard-of possibility".

"Something, that as far as we are aware, was virtually unknown throughout the world," he said.

The case against AGL follows settlements reached with the operators of other wind farms in SA which also breached the same regulations ahead of the blackout.

In July, Pacific Hydro Clements Gap Ltd was hit with a $1.1 million fine and the Hornsdale wind farm with a $550,000 fine.

While in December last year, the Snowtown Wind Farm Stage 2 was fined $1 million after the court found it had also operated for about three years with inadequate protection settings.

In the immediate lead-up to statewide blackout, severe storms damaged more than 20 towers in SA's mid-north, bringing down major transmission lines and causing a knock-on effect across the state's energy grid.

About 850,000 customers lost power, with some in the state's north and on the Eyre Peninsula left without electricity for several days.

A report from AEMO released about a month later found nine of 13 wind farms online at the time of the blackout switched off when the transmission lines came down.

It found the inability of the wind farms to ride through those disturbances was the result of safety settings that forced them to disconnect or reduce output.

In his judgment in relation to Pacific Hydro in July, Justice Richard White said the generators' use of non-approved settings meant AEMO was making important decisions concerning the secure operating limits of the power system on the basis of incomplete information.

In court on Friday, Justice Anthony Besanko reserved his judgment in relation to the proposed penalties and orders to be imposed on AGL.


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