The continual development and uptake of distributed energy resources (DER), like home solar and batteries, electric vehicles (EVs) and chargers, smart meters, and home energy management technologies, means that energy supply and storage is no longer exclusively a one-way system. The connectivity of these DER allows consumers to actively participate in their use of energy, and gives retailers more options for managing supply and demand.

Origin Energy has recently launched its new energy grid – named Origin Loop – a Virtual Power Plant (VPP) that connects thousands of energy assets through artificial intelligence (AI) to function like a traditional power station.

Brendan Manzie, Group Manager, Future Energy at Origin, said the VPP’s functionality is twofold, “There’s a backend to it that allows us to now connect to, talk to, and orchestrate a range of different energy assets, both generation of energy and also demand points of energy. And, on the flip side, it’s a customer experience and an engagement tool that ultimately allows for greater digital experiences.”

The notion behind the Loop was to move away from an energy system that was reliant on a small number of big points of supply in coal and gas generators, and instead create a much bigger connected network of devices to foster reciprocity between supply and demand.

“We now have around 100,000 connected customers and endpoints as part of the Loop,” Mr Manzie said. “And, we’ve done that in a way that spans a range of different energy asset types. So, we’ve got everything from solar systems to batteries, to EV chargers, to hot water systems, to smart devices, large business customers, and even lots of small customers through behavioural demand response, all now connected to the Loop.”

A recipe for AI

Origin Loop was developed over about 12 months, beginning with the build of an artificial intelligence engine that could communicate and connect with various points of energy supply and demand.

The VPP’s AI uses a range of data from weather forecasts, market trends and historical energy consumption, to communicate with the National Electricity Market (NEM) and with Origin’s large-scale generation assets, to optimise efficiency.

This data helps to inform demand and supply forecasting, and gives an overview of what’s happening in the energy marketplace. The next step is for the AI to look at the different assets connected to the VPP and their varying characteristics, such as when they are available, when they use energy, when they are dormant, and when they might be charging.

Finally, and importantly, the impact for the customer has to be considered, in order for them to “achieve their objectives of affordable sustainability”.

So, the combination of historical and tailored forecasting data and the AI’s capability to react accordingly has been designed to create the most balanced system which makes the most use of renewables at the lowest cost, whilst offering the end customer the best value.

“That’s really the secret sauce,” Mr Manzie said. “As we look ahead, we’re seeing a space where there’s going to be millions of connected points of supply and demand appearing very, very quickly in our grid.

“So that capability to understand when those assets are available, how a customer in the home or the business behaves, and therefore how to orchestrate those things in a dynamic fashion and learn from it, that’s going to be really important.”

Consumer appetite for understanding

Mr Manzie believes that there’s an undercurrent among energy consumers of wanting to actively participate in reducing their energy consumption, and a thirst for an understanding of how they can be more energy efficient – for both cost and energy-saving purposes.

This has resulted in a huge uptake in-home solar and batteries being added to Origin’s VPP, which in turn helps to build better capabilities in the technology, thus adding value back to the consumer. Mr Manzie said that with this VPP participation, comes more engagement from consumers in terms of understanding their role in the energy ecosystem and an appetite for visibility of that.

“There’s this real moment of awakening, where they’re part of this now connected energy ecosystem,” Mr Manzie said.

Home solar and batteries are not an option for all energy consumers though, so in order to cater to the other segment of the market, Origin has integrated a demand response program called Spike into its Loop VPP.

The program acts as an energy-saving rewards program, which rewards consumers when they meet their energy targets (usually set for hours when energy demands peak).

Origin has been monitoring consumer activity through the program and, according to Mr Manzie, has witnessed excellent engagement from users and a sense of meaningful connection to energy consumption (i.e. understanding the impact of different energy-consuming devices like heating and cooling on bills and overall household consumption).

Energy consumers are also able to connect smart devices through the program, an incentive that has been popular. “We have a capability in the backend where smart plugs and smart air conditioning controllers can be enrolled into our Spike program,” Mr Manzie said.

“Those devices can be automated to participate in energy-saving hours and Spike hours. It goes to show you, you’ve got these users out there who have these smart devices looking for ways to make them more useful in the home, and things like energy efficiency is a real emerging piece there.”

Still more barriers to overcome

Mr Manzie said the ideal outcome for the VPP is for it to assist in accelerating the role that renewables can play in the energy system, and to deliver more renewable solutions to Origin’s customers in an affordable and simplified way.

In terms of energy retailers facilitating large-scale accessibility and affordability, Mr Manzie said there are some current solutions, like longer-term, low or zero interest payment plans, and incentives for coupling batteries with solar purchases.

Mr Manzie emphasised the importance of “cash-flow neutrality” (where the costs that the consumer has to pay for solar and home batteries is more or less neutralised by the savings on their energy bill) as an important element to compel consumer investment.

Unfortunately, there are still barriers for renters and those living in apartments when it comes to accessing energy-efficient schemes, which will likely require policy changes to rectify.

“There’s definitely more work to be done there, to look at those models where renters and people living in apartments can access things like solar and storage,” Mr Manzie said.

Although there’s modelling from Origin and other retailers in that sector, Mr Manzie said that he’s yet to see anything promising yet, but anticipates more development to open up in the next five years or so.

“Bringing renewables into the system, normalising that for people is something that’s worth backing and getting involved with, because one, you can deliver on cost and affordability, but two, you can deliver on those sustainability objectives,” Mr Manzie said.

Getting the groundwork right around the technology and connectivity, and underpinning regulations and policy that “level the playing field” between energy consumers and providers is paramount for Origin.

Perhaps most importantly, Mr Manzie said, is that the consumer gets the right value, and the right experience.

“They’re going to be an active part of a really positive, renewable future – and that is important.”

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