Embedded Network SGA

What is a Small Generation Aggregator?

Within the National Electricity Market (NEM), a Small Generation Aggregator (SGA) is, as defined within the National Electricity Rules (NER), "A person who intends to supply electricity from one or more Small Generating Units to a transmission system or distribution system...". Primarily, SGA’s allow energy generated on-site to be sent out and sold at a wholesale price, rather than rely upon a feed-in tariff.

Updates

As of the 3rd of June 2024, changes have come into effect as part of the Integrating Energy Storage Systems (IESS) plan, which includes a transition to the Integrated Resource Provider (IRP) role. This change will see SGA providers re-classified as Small Resource Aggregators (SRA), with expanded access to value streams that better align to a future market design. While the change will greatly expand the opportunities for SRA providers, Embedded Networks and in particular Electrical Embedded Networks will continue to be an efficient and accessible pathway for these value streams to innovate and access the market. You can read more about this transition in our insight article HERE, or via our IRP web page HERE.

What does an SGA look like within the NEM?

SGAs fall within the Market Small Generation Aggregator (MSGA) Market Participant category, defined within the NER as “A person who has classified one or more small generating units as a market generating unit…”. Following a successful registration process, these SGA's are exempted from the requirement to register as a generator, either automatically or upon application based upon their generation capacity. This framework reduces the barriers to small, on-site generation being exported to the NEM, with all sent out generation sold to AEMO at the spot price which is settled 'On-Market'.

This access to the spot market can be facilitated relatively easily for SGA’s through an Embedded Network.

‍SGAs and Embedded Networks

‍While SGA's can exist within Embedded Networks, the existence of an SGA behind a meter does not automatically result in the configuration of an Embedded Network. Like any Embedded Network, it must have an established Parent Connection Point (Parent Meter) approved by the distributor, and is privately owned, controlled or operated. This is an important distinction that will impact SGA approval by AEMO. Any configuration of an SGA as an Embedded Network also results in the application of all relevant conditions and requirements from the AER's Electricity Network Service Provider Registration Exemption Guideline (Network Exemption Guideline).

Once an Embedded Network has been established, a NMI can be created for the On-Market Child Connection Point to enable the SGA access to the NEM.

This process is facilitated by an Embedded Network Manager, who can create the NMI and assist with the on-market process. An example of how this might look can be seen in the image below. Any consideration of an SGA as an Embedded Network for sites you may be considering, should also include active discussion with the distributor to ensure it will receive approval.

‍AEMO Approval and Registration‍
Depending on the size and configuration of the specific SGA, there are different information provision requirements in place for AEMO to determine the participant and site's ability to meet their expectations and compliance conditions. For those looking to understand more about SGAs and what is involved, we recommend accessing the AEMO Fact Sheet, Registration Guide and SGA Application Form.

For those looking for more information on the inclusion of an SGA within an existing or proposed Embedded Network, reach out to our team to discuss your project via the form and/or link below.