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Distributed energy marketplace trial launched in Victoria

On behalf of the Australian Government, the Australian Renewable Energy Agency (ARENA) announced $12.9 million in funding to the Australian Energy Market Operator (AEMO) for the development of a major Victorian Distributed Energy Resources (DER) Marketplace trial named Project Edge on 2 December 2020.

Based in the Hume region of northeast Victoria, the $28 million project will see AEMO partner with network an Australian energy company and energy equipment and solutions retailer to coordinate the development of a replicable model for the trading of electricity and grid services from DER that can be expanded across the National Electricity Market (NEM).

The three-year trial will create a prototype market for DER to be dispatched and traded as part of the NEM. Registered market participants, using customers’ DER, will submit bids to the market platform, and in turn, will make these bids visible to distribution networks to increase the reliability and resilience of the whole system.

Project Edge will initially involve around 50 residential customers, but then scale up to 1000 residential, commercial and industrial customers. The trial will provide the parties visibility and active control of the DER, helping to reduce electricity costs for customers and managing challenges associated with a decentralised grid.

ARENA’s funding will assist the development of the software and systems underpinning the first DER marketplace in Australia, to provide necessary insight and visibility over the distribution electricity system to AEMO and network operators to optimally balance the provision of grid services, ancillary services and energy from DER within the operational constraints of the distribution network.

ARENA has previously supported over $100 million of DER projects and established the Distributed Energy Integration Program (DEIP) a collaboration of government agencies, market authorities, industry and consumer associations aimed at maximising the value of customers’ DER for all energy users.

The ARENA CEO said this landmark trial would provide the blueprint for integrating DER into the grid. 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 the 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.

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. ARENA will work to develop a marketplace for the services these technologies can provide, and paving the way for widespread adoption across Australia.

The Executive General Manager of Emerging Markets and Services at AEMO noted that the agency 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.”

This trial, along with the financial support from ARENA, will facilitate the trading of aggregated electricity services from energy devices in peoples’ homes and businesses in north-east Victoria.

The trial forms part of the company’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.

The Executive GM of Growth and Future Networks the energy company noted that Australians have embraced rooftop solar and have a growing appetite for DER. This trial aims to demonstrate how they can have even more choice when it comes to energy for homes and businesses.

The companies’ teams are excited to be using the firm’s locally developed ‘Ubi’ hardware and software to demonstrate how a future energy market can support fully realising the financial and environmental benefits of energy resources.

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