The Australian Renewable Energy Agency announced on Wednesday it would commit $12.9 million to the trial, named Project Edge, which will develop a replicable model for trading electricity and grid services from Distributed Energy Resources (DER) which can be expanded across the National Electricity Market (NEM).
Australia’s first DER marketplace, the $28 million project will be based in the Hume region in north east Victoria and will see the Australian Energy Market Operator (AEMO) partner with network AusNet Services and retailer Mondo Power.
The three year trial will initially involve around 50 residential customers, but will eventually scale up to 1000 residential, commercial and industrial customers, with AEMO, AusNet and Mondo provided visibility and active control of the DER. These registered market participants, using customers’ DER, will submit bids to the prototype market platform, and in turn will make these bids visible to distribution networks.
“AEMO is working with the industry to design and test a world-first, two-way energy system and sophisticated market for consumers to participate in the NEM,” AEMO’s Executive General Manager of Emerging Markets and Services, Violette Mouchaileh, said in a statement.
“The trial forms part of AEMO’s DER Program to enable a smooth transition from a one-way energy supply chain, to a world-leading system that maximises the value of DER for all consumers through effectively integrating DER into Australia’s power systems and electricity markets.”
Leading the world in rooftop PV penetration, Australia has emerged as a laboratory for the effects of large amounts of solar power on grid operation. To better understand the mechanisms at play, ARENA has previously supported over $100 million of DER projects. The agency also established the Distributed Energy Integration Program (DEIP) in 2019 – a collaboration of government agencies, market authorities, industry and consumer associations aimed at maximising the value of customers’ DER for all energy users.
ARENA said funding for Project Edge will go towards the development of software and systems underpinning the marketplace. This is intended to provide network operators with insight and visibility over the distribution electricity system, hopefully helping them balance the provision of grid services, ancillary services and energy from DER within the operational constraints of the distribution network.
“As the uptake of rooftop solar, home batteries, home energy management systems, electric vehicles and smart appliances is expected to grow, it is clear that these technologies are going to transform our electricity system. While these devices and technologies can make our grid more reliable, affordable and lower emission, rapid uptake is already impacting how the grid is managed and highlighting the limitations of our existing market frameworks,” ARENA CEO Darren Miller said.
“This trial will help to develop trading mechanisms to maximise the economic benefits to customers and the system and minimise the costs of supply to all energy customers,” Miller added. He went on to describe the trial as a landmark which would provide the blueprint for integrating DER into the grid, paving the way for widespread adoption.
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