The National Electricity Market (NEM) Review should ensure that:
- Households and small businesses are offered fair value for the services they provide to the energy system.
- It identifies the multiple benefits locational marginal pricing offers consumers, including creating a market-based mechanism for additional dispatchable capacity.
- Any new market mechanisms are designed to ensure the most vulnerable and disadvantaged households are not overburdened.
Demand-side measures, such as household batteries and flexible appliances — for example, water heaters, pool pumps, electric car chargers, and other smart devices — can provide a substantial source of low-cost capacity, but face barriers, including limited consumer engagement, complex tariff structures, and regulatory barriers. If well integrated, such measures could reduce the need for peaking plants, transmission augmentation, and large-scale storage, thus lowering costs to energy consumers.
The National Electricity Market (NEM) Review should seek to ensure that demand-side measures have sufficient support to unlock their full potential, both for consumer benefit and to provide firmed, renewable generation and storage capacity in the NEM.