Demand Response: Helping to secure the grid by 2020.

In May, the Australian Renewable Energy Agency (ARENA) in partnership with the Australian Energy Market Operator (AEMO) launched their so-called  demand response program (  Five months on, ARENA and AEMO have awarded funding to ten pilot projects under the demand response initiative to manage electricity supply during extreme peaks. This $35.7 million, three-year pilot intends to deliver 200 megawatts (MW) of capacity by 2020, with 143 MW to be available for this upcoming summer.

Demand response is a concept that has been very effective internationally, and it is commonly used to avoid unplanned or involuntary outages, ease electricity price spikes and provide grid support services. In other countries, up to 15 per cent of peak demand is met with demand response.

The idea behind is simple as well as compelling: instead of building costly new power generating infrastructure to cater for the handful of times each year when peak demand for electricity spikes, demand respond  involves paying an incentive for energy users to reduce their power consumption, switch to backup generation or dispatch their energy storage for short periods when electricity reserves reach critically low levels.

The pilot projects will engage large scale industrial and commercial businesses as well as encouraging  thousands of households to sign up voluntarily to participate in exchange for incentives.

In the coming months, the pilot projects will be engaging customers and installing hardware to remotely monitor and control their energy usage. Household hardware will have optional user overrides.

ARENA also announced trialling an innovative range of technologies and behaviour change programs from voltage control to intelligent thermostats to app notifications, which could further assist in implementing smarter and more efficient energy supply systems.

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