The Australian Energy Market Commission (AEMC) has today received a rule change request to reform the National Electricity Market (NEM) to open it up to competition from demand response.

This would make it easy for households and small businesses to receive payment for reducing their energy usage during periods of peak demand, helping to balance supply and demand in the NEM.

The Australia Institute, Public Interest Advocacy Centre and Total Environment Centre are jointly sponsoring the proposed rule change.

“This rule change will see the wholesale energy market opened up to aggregator companies that help households and small businesses sell their demand response to the market,” says Dan Cass, Energy Policy & Regulatory Lead at The Australia Institute.

“By monetising this avoided energy usage, the NEM will be more efficient in delivering the price, quality and reliability in energy that consumers are calling for.”

“Wholesale demand response was recommended by The Finkel Review in 2017 and unanimously agreed upon by COAG Energy Council, who have asked the AEMC to develop a market mechanism to enable it,” says Craig Memery, Energy & Water Policy, Public Interest Advocacy Centre.

“This rule change would act as that mechanism, allowing ‘negawatts’ of avoided demand compete against megawatts of generation, and see all consumers benefit through lower prices and increased security,” says Mark Byrne, Energy Market Advocate at Total Environment Centre.