Companies, factories and farms will soon earn money by reducing their energy use when demand is high, in a move set to lower electricity prices.
The Australian Energy Market Commission has decided to set up a wholesale “demand response mechanism” to begin in October.
Demand response is when consumers are paid to reduce their electricity use at peak times to avoid shortfalls and blackouts.
But the three organisations behind the rule – the Public Interest Advocacy Centre, Total Environment Centre and the Australia Institute – are disappointed households won’t be part of the mechanism.
They say it will still bring benefits to consumers and is important for a zero-carbon energy system.
The Australia Institute’s energy lead Dan Cass says big energy users will be able to earn money by saving power when electricity prices are high.
“This will push down prices for all consumers, improve reliability and help Australia safely retire our 20 remaining coal-fired power stations,” he said on Thursday.
Energy Minister Angus Taylor said the rule will result in a more reliable power supply.
“The benefits of wholesale demand response will flow through to all households and businesses through lower electricity bills and improved network reliability,” he said.
“Lower electricity costs on small businesses and industry means Australians have more money to invest, expand and grow jobs – and this is particularly important as businesses recover from COVID-19.”