Measures of Reliability Risk for the Australian Energy Sector

Abstract: The article identifies the desired properties of the reliability risk metric for the Australian Energy Sector. It proposes a comprehensive set of metrics designed to measure various aspects of the reliability risk when a large portion of power generation is composed of variable renewable energy (VRE). The suggested methods aim to balance the tradeoff between economic benefit and risk management, effectively address the tail risk, and interpret the severity of the outage in a direct way. Properties of the considered reliability metrics are investigated by using simulation studies that use time series of expected unserved energy values. Sample distributions, dependency structures and other statistical properties of the metrics are studied. The results suggest new tools and approaches that can be used to increase the efficiency of the Australian Energy Sector.