Rather than building a $50 million transmission asset, water utilities, hospitals and manufacturing companies are putting in their own grid.

The All-Energy Australia Conference and Exhibition in Melbourne last month revealed some disruptive technologies in the wings for the grid. Among them are the power of demand side management and micro grids. Sandra Edmunds dropped in to pick up some of the main threads.

Demand side management will empower companies on the fringes of Australian cities to utilise their assets and industrial processes to save and even make significant money, according to experts speaking at the All-Energy Australia Conference and Exhibition in Melbourne last month.

During the Looking at the evolution of the current grid to the future grid seminar, GreenSync managing director Dr Phil Blythe said that the actual cost to consumers of not managing peaks in electricity demand was a conservative $1 billion each year. Handling these peaks with demand side management is about understanding when you can best use your energy, he said.

“That control isn’t where it used to be sitting in the centre of the equation with the large generators,” Dr Blythe said. “It is now out in the fringe and it’s in the hands of customers to make the decisions about when to decide to run a factory process or run a generator.

“Businesses are the end users of electricity and by managing peaks at their own sites there are considerable savings that can be propagated back to business at the end of the day.”

GreenSync assisted Sydney Olympic Park to achieve savings using automated demand management, a demand response program with Ausgrid, and various other efficiencies such as reducing pool pump operation times.

“The new world of demand response needs to be faster and certainly one of the key things in terms of future grid and smart grid.  Automation is one of those key enablers,” Dr Blythe said. “As the markets get more volatile, more automation around where people use their energy will become more commonplace.

“Essentially making the most out of demand side management it is about finding all the parts of the energy equation where there are savings that can come from utilising an asset.”

Dr Blythe outlined other emerging trends in Australian energy market.

Sites are operating their own network infrastructure

“There is a big trend towards embedded networks for large facilities such as large supermarkets, shopping centres, airports, ports, new precincts with apartment complexes and mixed use businesses.”

These energy users are managing the network assets – the transformers and the high voltage lines – to better control how much they are generating themselves and to manage their connectivity with the grid.

“This is a big trend that we are going to see more of and this is really the emergence of the micro grid story,” Dr Blythe said.

Mobilising communities to manage peak demand

“We are now actually able to mobilise communities to take power back into their own hands,” Dr Blythe said. Some regional communities are competing against transmission companies to prevent the need for new assets and expensive infrastructure to be developed.

“Rather than building a $50 million transmission asset, the water utilities, the hospitals and the manufacturing companies are getting together and putting in their own grid.”

Industrial Demand Side Response Potential

Recent research by ClimateWorks found huge opportunities for companies to reduce their own electricity bills while helping respond to peak demand pressures on the national electricity grid.

Many of Australia’s industrial electricity customers would be able to shut down production with as little as two hours’ notice to help manage peak load demand, ClimateWorks Australia project manager Eli Court said.

Mr Court said there was “outstanding potential” for industrial demand side response within Australia.

“A lot of people were talking about the importance of demand side response especially before we saw the change in demand forecasts because we were grappling with the problem of rising expenditure in network infrastructure to deal with peak demand,” Mr Court said. “But no one had really looked at how much of that opportunity was out there.”

ClimateWorks Australia’s research analysed 45 companies across 22 sectors that make up 83 per cent of Australia’s industrial electricity users. Researchers considered just operations that would find it technically and commercially feasible to reduce energy use for a period of time. Suitable industries included fabricated metal manufacturing, metal ore mining, sugar and confectionary manufacturing, ceramic manufacturing and cement manufacturing.

Companies were asked if they would be willing to reduce energy demand six to 10 times a year during peak events if they were given incentives such as a percentage off their annual electricity bill.

“Over 95 per cent of those identified potentially could be available within two to four hours’ notice,” Mr Court said. “The industrial demand side potential we found was 3.8GWh which was around 10 per cent of total peak load across the industrial, commercial and residential sectors.”

This represents just 42 per cent of industrial demand.

“And this actually corresponds quite well to what we see happening in the Western Australian market today,” Court said. In Western Australia there is an incentive mechanism built into the market similar to the incentive the companies were hypothetically offered in the ClimateWorks interviews.

“In the National Electricity Market you don’t see that level of response at the moment; you see about 2.7 per cent of total demand being met through demand side response,” Mr Court said.

“So obviously there is some outstanding potential in the national energy market that isn’t currently being captured.”

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