An industry peer recently told me we must not let perfect be the enemy of good if we are to stand any chance of adopting demand response as an essential part of our future energy mix. I cannot agree more.
I am a firm advocate for Demand Response, but I am also the first to admit it has many challenges. For example, how do we accurately calculate the baseline to then figure out the load reduction? How do we avoid people being rewarded when they did not participate? How do we best engage consumers so they will take part in events? Should automated demand response be rewarded differently to behavioural demand response? The list of challenges goes on.
Globally, we have been working to address these challenges for many years, and improvements are being made all the time. If we wait to perfect everything, our communities will miss out on the enormous opportunities Demand Response gives us.
The recent AEMO ARENA Demand Response initiative is a breath of fresh air. Many pilots, all trying different approaches, to achieve the same outcome. However, we need to understand that every pilot will hit issues and will not work as expected. We should embrace this. It will not mean Demand Response has failed; it will mean we have learnt something we can build on. Perhaps we could have engaged customers differently, designed our incentives another way, or changed the duration of the demand response events.
Everyone involved, AEMO included, have a lot to learn. So I hope we, as a community, do not place such high expectations on the pilots being a success that we force the learnings underground. The worst outcome will be to have all pilots report 100% success. Why? Because that won’t reflect reality, and means crucial lessons will be lost. I am not suggesting the experiences be publicly shared. The participants are after all operating in a competitive marketplace. But these pilots are primarily being funded by ARENA, so mechanisms need to be put in place that reward the pilot participants to share the good, the bad, and the ugly with ARENA. This is the only way to ensure we deliver the full value demand response has to offer.
Each one of the ARENA AEMO Demand Response pilots will have components never tested here in Australia. We need to applaud all participants for their innovation. Encourage experience sharing and avoid important lessons being buried for fear of having their pilot flagged a failure.
We are entering a crucial phase for demand response here in Australia, let’s not set it up for failure before it even starts.
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