Accelerating Commercial & Industrial Demand Side Participation in NSW
Commercial and Industrial energy users the answer to NSW Government jitters over Eraring closure
Our report highlights an underutilised opportunity for the NSW Government to take advantage of Demand Side Participation (DSP) to not only provide additional ‘insurance’ over the coming years to allow the timely closure of Eraring coal-fired power station but also a win-win for consumers.
Nexa Advisory’s report provides actionable recommendations about how the NSW Government can take advantage of C&I DSP. According to the report, C&I Distributed Energy Resources (DER) can play a significant role immediately. However, more work is needed to accelerate the participation of C&I in supporting a less emissions-intensive National Electricity Market (NEM).
The report also highlights that DSP represents an underutilised tool with significant potential of 3100 to 6000 MW in the NEM. It is a lower-cost resource than supply-side capacity because it utilises the capability of existing assets and consumer loads who participate in these programs. However, existing mechanisms fail to unlock DSP’s full potential.
Participation rates in the Wholesale Demand Response Mechanism (WDRM) are well below its anticipated potential. The NSW’s Peak Demand Reduction Scheme (PDRS) is currently only available for C&I DSP through the WDRM mechanism, which has failed to deliver.
The report urges the NSW Government to undertake an auction focused on DSP in NSW through either the Capacity Investment Scheme (CIS) or Long-Term Energy Services Agreement (LTSA) to fully leverage the power of DSP.
The full report and recommendations are available on this link: Nexa Advisory Report- Accelerating C&I demand response in NSW
