The landscape of the energy industry in Australia is rapidly evolving, driven by the transition toward renewable energy sources and the need to achieve national renewable energy targets. As part of this transformation, the Australian Energy Market Commission (AEMC) has introduced rule changes that are now in effect to integrate energy storage systems and hybrid systems into the National Electricity Market (NEM). These changes as part of the Integrated Energy Storage Systems (IESS) rule change commenced on 3 June 2024 and include the introduction of the Integrated Resource Provider (IRP) market registration category.
This category will see all market participants registered as Small Generation Aggregators (SGAs) transferred to the IRP registration and will be given the label of Small Resource Aggregator (SRA).
In this context, SRAs and IRPs will play a crucial role with continued use of Embedded Network configurations to access and support the market.
- The IRP category simplifies and streamlines the registration process for innovative business models.
- IRPs include SRAs and battery energy storage systems.
- From mid-2024, all SRAs will be transferred to the IRP registration category.
- IRPs have greater flexibility to support competition and realise additional value streams.
- SRAs are entities that aggregate small generating and storage units, previously known as Small Generation Aggregators (SGAs).
- Small Generation Aggregators (now SRAs) are market participants supplying energy aggregated from multiple generation sources, exempt from registering as a generator.
- Before this change, aggregated small generation units were unable to participate in any ancillary markets.
- They can now participate in the NEM by providing market ancillary services, which are essential for power system security, orderly electricity trading, and maintaining acceptable electricity supply quality.
- SRAs can choose to offer services such as frequency control, voltage management, and network stability.
- The AEMC’s rule change allows SRAs to participate more effectively in the energy market.
- Hybrid systems combine multiple types of generation (e.g., solar, wind) and batteries behind a single connection point.
- Bi-directional flow refers to units capable of both generating and consuming energy.
- Batteries, although not traditional generators,fall under the bi-directional flow category.
The IESS rule change focused on introducing flexibility into the National Electricity Rules and created a new registration category for bi-directional facilities, allowing hybrid systems to participate more efficiently. The IESS rule change simplifies the registration process for SRAs and battery energy storage systems.
From June 3, 2024, all SRAs transitioned to the IRP registration category.
Embedded Networks are unique in their ability to enable access to the market for SRAs and IRPs using child connection points. Once a site has been established as an embedded network with a Parent Connection Point (Parent Meter) approved by a distributor, a child NMI can be created to enable access to the National Electricity Market through a child connection point.
Child NMI's can be used for market access of these SRA assets, whether for generation or bi-directional units, or as part of a coupled production unit. Embedded Network models provide an innovative entry to the SRA market for more customers, and further use of innovative network and building designs to facilitate these new value streams.
This process requires an Accredited Embedded Network Manager to create the NMI and will often involve support to assist establishing the Embedded Network with a distributor.
ENM Solutions has experience working with these bespoke embedded networks and enabling market access. Those considering use of these configurations to realise SRA or IRP value streams can reach out to us for an informed conversation about how we can help you achieve your goals.
SRAs and IRPs play a pivotal role in supporting competition, enhancing grid stability, and unlocking additional value in the evolving energy market. There are a range of great resources available from the Australian Energy Market Operator (AEMO) and the AEMC that are worth exploring, including under the Energy Innovation Toolkit. You can also check out our SGA page for a basic outline of how this SRA role can be established within an Embedded Network.
While the name change may lead to some confusion, the function and operation of SRAs will retain it's original capabilities and enable more innovative use of Embedded Networks, with the expansion to allow for hybrid systems, ancillary market involvement and improved value streams to be realised.
Should you or a project you are involved with be interested in discussing how Small Resource Aggregators could work for you, including consideration of an Embedded Network or Microgrid, please contact us for an informed discussion.
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