Clean energy, meet smart energy: matching renewables with flexible demand for an affordable and reliable energy system
Two-part afternoon forum: Monday 25 November 2019, Sydney
Luke Menzel's event wrap
Monday 2 December 2019
On Monday 25 November the Energy Efficiency Council held its final National Energy Efficiency Forum of 2019, Clean energy, meet smart energy, presented in partnership with Flow Power.
This forum explored how policymakers and regulators are planning to unlock demand response opportunities for energy users, and how businesses can seize those opportunities, now and in the future.
For a comprehensive write up of some of the key presentations from the afternoon, see Michael Mazengarb's excellent article in RenewEconomy. However, a few key points stood out for me:
Suzanne Falvi, Acting Chief Executive of the Australian Energy Market Commission (AEMC), explained the AEMC's draft determination on wholesale demand response, and the benefits it could provide to the market: increased competition, encouraging energy users to voluntarily adjust consumption to balance with supply, and reducing expenditure on supply side infrastructure. Suzanne also pointed to the role of digitalisation in unlocking a truly 'two-way' energy market.
Nathaniel Galindo of Flow Power talked through how demand response continues the trend of moving businesses to the centre of the energy system, and how proactive businesses can bring down their own costs while improving system reliability and helping balance supply and demand.
Jeffrey Neave, who leads environmental management for Molycop Australasia, described the industrial processes at their Newcastle facility – including a 36MW electric arc furnace – which result in an electricity bill of around $2,000,000 a month. By responding to the spot market and utilising targeted demand management on key processes, Molycop has been able to unlock significant savings.
Simon van der Aa, Portfolio Manager for Bass Strait Islands, Hydro Tasmania, shared insights from the King Island Renewable Energy Integration Project and what they mean for grids on the mainland. He described the journey to 100% wind penetration on King Island, via the addition of demand management and storage technologies, including batteries, flywheels, a 1.5 MW dynamic resistor and a smart grid that provides additional demand side flexibility.
Darren Miller, CEO of ARENA, discussed the major contribution ARENA's demand response trials have made to improving practical understanding of how demand response can be applied in the market; notably these trials have increased confidence in the reliability of commercial and industrial demand response portfolios. Darren also pointed to innovative flexible resources that could prove essential in the future grid – virtual power plants (VPPs), thermal storage and electric vehicle smart chargers.
Finally, Kerry Schott, Chair of the Energy Security Board (ESB), picked up Suzanne Falvi's comments on the journey to a 'two way' energy market. She said that the ESB's current review of how the National Electricity Market (NEM) should operate post 2025 will almost certainly focus on enabling more market participation from behind the meter resources – including appliances with flexible load, batteries and solar. The goal of new rules will be to make these resources more visible to market operators, and easier to dispatch.
It was a timely discussion and one that is only going to gather pace in 2020. We are in the midst of a major period of regulatory reform:
- NSW has announced it will introduce a new demand reduction scheme, which will provide incentives for devices that can deliver flexibility back into the electricity market;
- COAG Energy Council approved the introduction of requirements that will ensure new air conditioners, pool pumps, electric hot water systems and electric vehicle chargers sold in Australia are demand response enabled; and
- This Thursday we will get the AEMC's final determination on the wholesale demand response mechanism; if it proceeds as anticipated, this will act as the kickoff for a whole new wave of engagement with businesses across the economy around flexible demand.
Our job at the Energy Efficiency Council is to ensure all this effort results in sensible, practical policy and regulations that deliver for consumers while building the market for energy management products and services.
We will also be highlighting the continued, crucial importance of energy efficiency, and working to ensure flexible demand complements energy efficiency to deliver an affordable, reliable and sustainable energy system for Australia.
It's going to be a big year. We look forward to continuing the conversation in 2020.
This event was delivered in partnership with