The Australian Energy Market Commission (AEMC) is consulting on ways to better integrate unscheduled price-responsive resources into the national electricity market (NEM).

As more households and businesses invest in newer technologies such as batteries, rooftop solar, electric vehicles and home energy management systems, these consumer energy resources (CER) will play a vital role in the shift to a net zero energy system.

Similarly, traditional assets such as hot water heaters and pool pumps will continue to play their part in how the energy system performs and transforms.

As a result of the rapid uptake of CER, energy companies are increasingly combining these resources to form Virtual Power Plants (VPPs), which are actively responding to price signals in the national electricity market (NEM).

Additionally, there are commercial and industrial resources such as chillers and hydrogen electrolysers, which could be price-responsive and significantly impact the energy market in the future.

Currently, these resources are not fully integrated into the NEM’s planning and operation functions. By integrating them more effectively, AEMO could accurately determine how much energy demand needs to be met, how to meet this demand and the price at which electricity is purchased.

Better integration of these resources could lead to more efficient network and wholesale market services, reducing the overall cost of providing reliable electricity to consumers, ultimately leading to lower prices.

The Australian Energy Market Operator (AEMO) states that without efficient integration of price-responsive resources, additional costly large-scale generation, storage, and network infrastructure may be required to maintain a secure and reliable electricity supply.