An Australian Energy Market Commission paper outlines options to better integrate storage such as batteries into the power system.

The paper calls for stakeholder feedback on a number of framework options for proponents of energy storage to join and participate in the national electricity market (NEM).

It responds to a rule change request from the Australian Energy Market Operator (AEMO) seeking to support the participation of storage systems, such as batteries, in the NEM. The proposal also looks at hybrid businesses that combine technologies behind one connection point to export and import electricity.

After releasing a consultation paper and receiving submissions, the AEMC’s options paper will seek input on alternative solutions to those proposed in the rule change request that may better accommodate the needs of the future power system and market participants through transition to a two-sided market.

A truly two-sided market would allow all types of consumers to unlock value from their distributed energy resources (like solar and batteries) or from shifting their energy use. For example, this could mean households letting set and forget devices consume power when prices are cheap and export it when this is more lucrative.

This is aligned with broader considerations by the Energy Security Board on making the NEM fit-for-purpose in a changing energy landscape of expanding consumer choices, new technologies, richer data and large-scale generation replacement as ageing thermal power stations leave the market.

AEMC Acting Chair Merryn York said the Commission was focussed on getting the grid ready for an era of energy storage.

“There is a huge transition occurring in the national electricity market,” Ms York said.

“Energy storage is expected to have an increased role. A number of reforms to the market are likely to strengthen the incentives for batteries, including the move to five-minute settlement in the NEM from October next year as this will reward technologies that can be deployed quickly.”

Submissions to the AEMC’s earlier consultation paper generally sought improvements to the framework for storage participation but also argued for a considered and incremental approach to the changes to ensure alignment with any larger reforms being considered by the ESB.

The AEMC’s paper covers a spectrum of four options. These range from no change to more significant changes to the way storage and hybrid facilities register and participate in the NEM.

The paper also seeks feedback on other issues, including how best to achieve consistency among market participants for the recovery of non-energy costs.

Submissions to the AEMC options paper close on 11 February.


Media: Kellie Bisset, Media and Content Manager, 0438 490 041