21 October 2025

An innovative market process to secure additional long-duration dispatchable energy capacity is now underway, with a call for tenders inviting bids to provide 700 megawatts of long duration dispatchable capacity. This will be a major step in implementing the state’s Firm Energy Reliability Mechanism (The FERM) which was established to combat a trend towards diminishing long-duration dispatchable capacity.

The scheme will establish contracts with eligible existing and new long-duration firm capacity power generators, effectively underwriting a portion of their revenue to create financial certainty for market proponents outside of sporadic and infrequent high price events. The availability of this firming generation will be critical for maintaining the reliability of South Australia’s electricity system.

The state's current fleet of firming generators are beginning to reach the end of their operating timeframes and retire and there are currently no similar types of generation replacing it.

This, together with the FERM, will ensure South Australia’s power supply remains secure and reliable, even when the sun isn’t shining and the wind isn’t blowing.

The FERM will also protect South Australian consumers against potential National Energy Market-wide price and reliability risks in future years as coal-fired power stations in New South Wales and Victoria are retired.

The FERM mechanism will incentivise continued market participation for existing long-term generation operators as well as supporting the entry of new eight-hour-plus firm dispatchable capacity in South Australia.

It is anticipated that a range of new long-duration storage technologies will participate, in addition to gas turbines.