The Australian Energy Market Commission (AEMC) has taken a critical step as part of a broad set of reforms aimed at making it easier for households and businesses to capture the value of their customer energy resources (CER) and exercise greater control over their energy bills.  

‘CER’ refers to smaller-scale energy resources owned by customers, which can produce, store, or vary how they use energy. There are newer forms of CER such as solar panels, batteries, and electric vehicles, and more traditional assets such as hot water heaters and pool pumps.  

Australia’s energy landscape is being transformed by the uptake of these resources and consumers becoming more engaged in the different ways they can use them.  

The Australian Energy Market Operator’s Integrated System Plan states that by 2030 at least one in eight households will have a battery or electric vehicle, or both. By 2050, that number is expected to rise to one in four. Around one in four free-standing Australian homes have solar panels, with one in two expected by 2040.  

These trends represent an enormous opportunity for Australia’s energy future. CER, along with resources such as neighbourhood batteries, have an important role to play in the power system. They can help reduce overall system costs, improve reliability, and achieve a secure, low-emissions energy supply for all consumers.

Understanding this, the AEMC is prioritising vital reform that aims to unlock the full potential of CER – for the benefit of both the customer who invested in those assets and also for the benefit of all customers through the resulting improvements to the operation of the overall system.  

Chair Anna Collyer says investing in these resources empowers consumers to generate, consume, store, and trade energy according to their preferences.

“By using these assets in a smart way, customers can lower their energy bills, and should they choose, share the power they generate or vary their consumption in such a way that it supports the overall grid,” Ms Collyer said.

Positions on how to unlock the benefits of CER were outlined in a draft determination paper, published today. Specifically, the AEMC is considering creating new arrangements for:

• ‘Flexible’ trading by enabling all customers to have CER separately metered and therefore identified and managed separately from other ‘passive’ consumer loads such as lights and fridges.
• Large customers to choose multiple energy service providers for their premises.
• An in-built measurement capability in technology such as streetlights and EV chargers to be used instead of additional meters, which allow for the measurement and management of energy use at lower cost.  

The key benefits of this rule change could include:

• Supporting customers to take up different products and services for their CER which will in turn help them to reduce consumption costs or improve the value they can get from their assets.
• Promoting innovation and competition by reducing barriers for market participants to provide wholesale energy, ancillary services, and network services.  
• Supporting more CER integration by making it easier for those resources to be identified and managed separately, helping to deliver reliability, security, emissions reduction, and reduced costs for all consumers.

This rule change request, submitted by the Australian Energy Market Operator (AEMO), is one of several key CER workstreams the AEMC is focussed on in 2024.  

We are looking at ways to create greater visibility of price-responsive resources, such as household batteries, and make it easier for them to participate in the market. We think this could help AEMO and networks to operate the system more efficiently, ultimately leading to lower prices and emissions.  

We are also fast tracking rule changes we recommended last year, including a 100 per cent rollout of smart meters. While solar panels provide low-cost energy to their owners and the grid, smart meters at every home could allow non-CER owners to also benefit from the cheap energy provided by these assets.

A government CER taskforce has now been established, following Ms Collyer’s calls for urgent reform last year.  

“We at the AEMC are steadfast in our pursuit of pushing reform that’s required to unlock the benefits of these resources, while also mitigating any risk that comes about as a result of the speed and scale of change.

“The key to a successful transition is integrating these resources effectively into the National Electricity Market. Our only choice is to be well prepared. If we do not properly integrate CER into market processes, we face materially higher generation, network, and intervention costs. Consumers have a critical role in the transition – but to do so – they need sound policy decisions from us all,” she said.

Visit the project page for more information and contact details.

Media: Jessica Rich, 0459 918 964, media@aemc.gov.au