A new report from the Australian Energy Market Operator (AEMO) highlights the role demand response played in improving energy security last summer.
The review summarises how the NEM operated over summer 2017-18, and shows how extensive and collaborative planning helped mitigate the identified risks. It also identifies lessons learned and emerging challenges AEMO is considering in preparation for summer 2018-19 and future years.
AEMO’s objective for summer was to enable sufficient resources to support the operation of a secure, reliable, and cost-efficient power system. AEMO said it is satisfied that this objective was met, with broad collaboration and support from industry participants and governments.
Energy Efficiency Council CEO, Luke Menzel, welcomed AEMO’s Summer 2017-18 Operations Review as evidence that Australia’s market operator is meeting the challenge of improving the reliability of Australia’s energy system.
“The 2016-17 summer was rough for consumers, with load shedding events hitting households and businesses on very hot days. There were serious risks for 2017-18 if some of our old, large generators had broken down during a heat wave,” Mr Mezel said.
“AEMO has stepped up to the plate, securing generation and demand response to help them manage risk during periods of peak demand last summer.”
Under the ‘Reliability and Reserve Trader’ (RERT) scheme, AEMO secured 141MW of demand response in New South Wales, South Australia, and Victoria over summer 2017-18.
RERT resources were activated twice over summer, during very hot days when energy use was peaking and the system needed an additional buffer.
“AEMO found that demand response resources were effective, and performed to expectations,” Mr Menzel said.
“The experience over summer demonstrates that demand response is both reliable and available. The fact that AEMO was able to secure 141MW of demand response capacity in just a few months as part of its broader summer preparations, underlines just how underutilised this resource has been.
“The big message out of last summer is the crucial role the demand side will play as we move to a more dynamic, flexible and responsive energy system in Australia.
“However, so far we are only utilising demand response for ancillary services and emergency capacity. As AEMO flags in their report, the next step is competition between supply and demand side resources in the wholesale electricity market, which is one of the very few options we have to quickly drive down energy prices for businesses and households.”