The AEMC has released proposals to open up the wholesale electricity market so large consumers can be more easily paid for reducing their demand on the power system. The wholesale demand response mechanism draft rule is in response to requests received from the Total Environment Centre, The Australia Institute and the Public Interest Advocacy Centre; the Australian Energy Council and the South Australian Government. 

The AEMC has published discussion notes from the fourth meeting of the Wholesale demand response mechanism technical working group. Members of the technical working group are experts from consumer groups, large consumers, network businesses, retailers, technology providers, market bodies and AEMO. 

At the meeting on 11 October 2019 the group discussed a range of issues arising from submissions made to the draft determination. These included:

  • reimbursement rate: Under the draft rule, the reimbursement rate would be set based on load weighted average spot prices. Different approaches to determining the reimbursement rate and some analysis of different methodologies were considered by the group. 
  • application of the mechanism to small customers: Under the draft rule, small customers would not be able to participate in the mechanism while the Commission undertakes a review of whether energy-specific consumer protections should be extended to demand response service providers (DRSPs). The technical working group discussed additional implications of small customers participating. 
  • implementation date for the mechanism: Under the draft rule, the wholesale demand response mechanism would commence on 1 July 2022. The technical working group reflected on this date and the implications of changing this date for the final determination. 

A final rule and final determination for this rule change request are due to be published on 5 December 2019.

These rule change requests are being progressed as part of the Commission’s broader system security and reliability action plan

Media: Prudence Anderson, Communication Director, 0404 821 935 or (02) 8296 7817