Australia is standing at the crossroads of an energy transformation as ambitious decarbonisation and renewables targets drive the rollout of clean and affordable energy at scale.
With the Australian government’s target of 82 per cent renewable electricity by 2030, a new EY Net Zero Centre report, From Chaos to Choreography, delves into the pivotal role of distributed energy resources (DER) in steering Australia towards a net-zero future.
Distributed energy resources encompass a diverse array of technologies, including rooftop solar, batteries, electric vehicles, and smart appliances.
As Australia leads the world in solar panel adoption, DER is poised to emerge as the primary source of dispatchable capacity by 2050, with projections indicating that 50 per cent of all dispatchable capacity will come from DER owned by households.
However, unlocking the full potential of DER hinges on effective orchestration to optimise its value within the energy ecosystem.
“While Renewable Energy Zones (REZs) hold promise in accelerating the transition from fossil fuels to renewables, the long development timelines underscore the need to explore all available options,” said Emma Herd, EY Net Zero Centre Co-Lead and Partner, Ernst & Young, Australia.
“DER presents a ready-to-deploy solution embedded in homes and businesses nationwide, offering a pathway to expedite the energy transition.”
The Australian Energy Market Operator (AEMO) forecasts a monumental surge in DER adoption by 2050, emphasising its pivotal role in meeting evolving energy consumption needs.
However, realising this potential requires active engagement from consumers — a challenge in an industry plagued by low levels of trust and understanding.
“Empowering consumers to actively participate in the energy transition is paramount to its success. By simplifying choices and fostering regulatory frameworks that prioritise consumer interests, we can harness the full potential of DER orchestration,” Herd said.
“Consumers want to see change. Our research has shown that 75 per cent of consumers want to work with their energy providers to find alternative energy solutions.”
Navigating the complexities of energy markets poses significant challenges, discouraging consumer participation.
Streamlining regulations and enhancing consumer trust are essential steps to unlock the transformative potential of DER aggregation.
Recent pilot projects offer valuable insights into the feasibility and benefits of DER orchestration, laying the groundwork for scalable implementation.
“As we chart a course towards renewable energy targets, DER emerges as a critical enabler of this transition. Effective orchestration of these resources is key to ensuring a seamless transition and maximising the benefits of renewable energy for all stakeholders.”
The upcoming National Consumer Energy Resources Roadmap presents a pivotal opportunity to outline ambitious reforms and foster nationally consistent action.
Investments in DER uptake and orchestration are essential to accelerating Australia’s progress towards a sustainable and prosperous energy future.
Amidst the challenges posed by large-scale infrastructure projects, leveraging distributed energy resources offers a transformative solution to propel Australia’s energy transition towards net zero, and to share the benefits of the transition across households.
The Australian Competition and Consumer Commission (ACCC) highlights that up to 79 per cent of residential customers could save money by changing electricity plans, further underscoring the financial benefits of embracing DER.
“We need to set the rules early before most consumer assets are commissioned. Orchestration must be understood, and then trusted, to become second nature to customers. This will require simple, attractive, customer-centric offerings that unlock the value of DER for everyone. The time to act is now, as Australia positions itself as a global leader in renewable energy innovation,” Herd concluded.
From Chaos to Choreography is the first in a three-part Energy Infrastructure Executive Briefing Series, Stepping Up to Drive the Step Change, developed by the EY Net Zero Centre.
This series explores three critical levers that Australia must pull to decarbonise the electricity grid and drive down the cost of energy for consumers.
