The Australian Energy Market Commission (AEMC) has released a final report recommending that the wholesale demand response mechanism (WDRM) should continue operating in the national electricity market (NEM).

The WDRM allows large electricity users to be paid for reducing their consumption when the grid is under stress – for example, a factory temporarily switching off equipment during peak demand periods.

AEMC Chair, Anna Collyer, said the decision recognises the WDRM's ongoing role in Australia's evolving energy market.

"The WDRM enables some electricity users to effectively incorporate their demand response participation into market outcomes, which benefits all electricity consumers," Ms Collyer said.

"This is currently the only market mechanism in the NEM wholesale market that facilitates payment for reducing load against a baseline. It's also the only mechanism that allows non-financially responsible market participants to participate in the electricity market."

The Commission maintains its commitment to strengthening demand-side participation in the NEM. The recent Integrating price-responsive resources into the NEM (IPRR) and Unlocking CER benefits through flexible trading (CER benefits) rules provide the main vehicles for broad demand-side participation.

"While the voluntarily scheduled resource framework introduced through IPRR is the key vehicle to facilitate broad demand-side participation, the WDRM provides important additional benefits alongside this," Ms Collyer said.

The AEMC's second recommendation is that the pending rule change request, Expanding eligibility under the WDRM, should be initiated to assess whether sites with multiple connection points should be allowed to participate in the mechanism.  

This has the potential to increase participation in the WDRM and deliver additional benefits. We anticipate initiating this rule change in the first half of 2026.

For more information, visit the project page.

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