Networks encouraging competition to support the delivery of more capacity next summer

More batteries and demand management programs may be used by three of Victoria’s electricity distributors to meet changing customer needs and support power reliability next summer as part of a plan to enable new energy use or ‘flexibility’ markets.

CitiPower, Powercor and United Energy are offering third parties an opportunity to develop and implement solutions that can alleviate capacity constraints on the low-voltage network during peak demand periods.

A full tender seeking solutions for more than 240 sites is now open.

With homes and businesses using more electricity during hot summer days, pressure may be placed on parts of the local electricity network. At times, this can lead to a reduction in reliability and increase the possibility of power outages.

Traditionally, networks invest in upgrades or new infrastructures to accommodate peak demand during just a handful of days. However, smarter technology solutions are now providing networks with more cost-effective ways of managing peak demand without the need for upgrades.

CitiPower and Powercor Head of Network Planning Andrew Dinning said it was the first time all the three networks had opened their low voltage network up to third parties to provide solutions to address constraints that could limit supply or reliability.

“Extreme temperatures, heatwaves and customer growth can place pressure on our networks as more people rely on electricity to stay comfortable at home or work,” Mr Dinning said.

“As a distribution system operator, we want to access existing capability and create new markets to help us manage peak demand in the most cost-effective way for our customers.

“We’re expecting this tender to spark innovative ideas from market participants on both the supply and demand side.”

Non-network solutions may include embedded generation such as grid-connected or behind-the-meter battery storage or other demand management solutions and resources.

The projects will predominately support residential customers and will need to be operating by November this year. Detailed data and locations of the selected sites have been released to the market.

“This is an important step in developing the capability for publishing data on network capacity and constraints that can enable a whole range of new, creative energy solutions for customers as the energy market transforms,” Mr Dinning said.

As distributed system operators, the networks have been using demand management programs to address areas of network reaching their capacity limits for a number of years.