Briefing Note | May 2021
Integrated System Planning (ISP)
The Integrated System Plan (ISP) is a two-yearly process run by the market operator AEMO to present a long-term plan for the National Energy Market grid that spans Eastern Australia.
It replaced previous transmission planning processes, taking a broader strategic focus is on thinking about where major transmission investments should be made to strengthen the grid and enable new large-scale renewable investment.
Transmission operators can use the ISP as a basis for proposing new investments to the Australian Energy Regulator (AER), but each project still has to pass its own cost-benefit test.
Energy market bodies have collaborated to streamline the transmission investment approval process in light of the many transmission projects emerging from the ISP.
The ISP was the first exercise in mapping out where new grid extensions into areas of high renewable energy potential are likely to be cost-effective.
Like any forecast the ISP will be wrong to some extent. While it may be a major driver of new transmission investment, it shouldn’t be considered as a plan that is set in stone.