From the Interim CEO
For a long time, the debate about the energy transition centred on whether it needed to happen at all. With the adoption of Australia’s net zero targets, debate has now shifted to how this should occur.
To date, much of the focus has been on growing the supply side to ensure we have sufficient renewable energy resources and transmission – just this month we’ve seen billions of dollars in funding announced for additional transmission lines for WA and NSW. We think the same amount of attention should be given to bolstering demand side solutions.
Demand side solutions are not something we can just crowbar in. They will require us to bring consumers along on the journey as we’ll be asking a lot of them. After all, there is no system without consumers. Reshaping demand means consumers will need to change some long-established habits, build new norms for using electricity when it is abundant, and at times be adaptive and responsive to match a fluctuating electricity supply.
A cornerstone of this change is the role that Consumer Energy Resources (CER) can and should play. (If you’re not familiar with this term, it’s what we like to call Distributed Energy Resources. Find out more about why we prefer to say CER here.) If we get this right, CER can benefit the collective system by making it more resilient and flexible, while also benefitting their owners. Similarly, future supply and demand can be more evenly matched, helping to keep costs down for everybody.
Already we’re seeing an explosion of CER and the Integrated System Plan (ISP) assumes this growth trajectory will continue, predicting a more than thirteen-fold increase in the installation of “coordinated DER storage” between now and 2030. CER can bring low-cost capacity to the system without the challenges and likely delays of large-scale resources dependent on new transmission infrastructure. However, there is currently little policy to support this to date. And even less support to consider appropriate integration of CER into the market.
As more CER come online, industry is asking questions about how to best integrate them efficiently to deliver a reliable and secure system. However, it’s also important to remember that CER are consumer-owned assets that households and small businesses have invested in. It is key that we ensure consumers retain agency in how they wish to use their assets, and can access the full value and benefits of their investments, tailored to their needs and preferences.
What we know from our ongoing research program into consumer requirements for the energy system is that any options for managing CER will need to be ‘least cost’ and ‘least complexity’. ‘Least complexity’ means helping untangle the system, incentives, red tape, and actions we’re asking consumers to undertake. This is backed up by a recent report we released that found that an overload of dense information about energy issues is causing consumers to switch off.
Given the inherent human element involved in demand side management, there are complexities ahead. But the benefits for consumers are worth it.
Jacqueline Crawshaw
Interim Chief Executive Officer
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