Market Reviews: Open

Distribution Market Model

Reference:
SEA0004
Reviewed by:
AEMC
Initiated by:
AEMC
Date initiated:
01-Dec-2016
Project Leader:
Claire Richards
Overview

The AEMC is undertaking a ‘Distribution Market Model’ project to explore how the operation and regulation of electricity distribution networks may need to change in the future to accommodate an increased uptake of distributed energy resources such as rooftop solar systems, battery storage and electric vehicles. This project forms part of the AEMC's technology work program.

The AEMC is undertaking a ‘Distribution Market Model’ project to explore how the operation and regulation of electricity distribution networks may need to change in the future to accommodate an increased uptake of distributed energy resources such as rooftop solar systems, battery storage and electric vehicles. This project forms part of the AEMC’s technology work program

These ‘distributed energy resources’ present both opportunities and challenges, as distribution networks move away from facilitating one-way flows to more dynamic, two-way flows of electricity.  

The project is not intended to be a prediction of or pathway for future regulatory reform, but rather an exploration of possible distribution market design options that may be available to harness the opportunities presented by distributed energy resources, while addressing any technical impacts as they arise.

The AEMC published an approach paper in December 2016, which sets out the scope and context for the project, and the Commission's proposed approach to assessing a range of issues including:

  • the technical opportunities and challenges presented by distributed energy resources;
  • what, if any, new roles, price signals and market platforms are required to optimise the development, deployment and use of distributed energy resources;
  • how the role of distribution network service providers (DNSPs) may need to adapt to facilitate a transition to a more decentralised market for electricity services;
  • whether the existing electricity regulatory framework impedes or encourages innovation and adaptation by DNSPs to support the efficient uptake and use of distributed energy resources; and
  • whether changes to the existing distribution regulatory arrangements, or the design of a new market, are necessary to address any impediments to business model evolution.

Written submissions on the approach paper closed on 19 January 2017 and are available below.

This project forms part of the AEMC’s technology work program, which explores the flexibility and resilience of energy market arrangements in responding to technological change. The AEMC needs to have a strong understanding of new market dynamics to inform our rule making work and market development advice to governments.

 
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