The federal government and the Australian Energy Market Operator are banking on households joining virtual power plants (VPPs) to stabilise the grid and help deliver a cleaner, cheaper energy future. But so far, the public isn’t buying in. Only about 4% of Australians with a home battery have signed up to a VPP.
Dean Spaccavento, co-founder and CEO of Reposit Power, says the problem isn’t the technology – it’s trust.
“It’s a pretty rough environment for a consumer,” he told Renew Economy’s SwitchedOn Australia podcast. “I can’t really think of anything that is as rough on a consumer as the electricity system. It changes so quickly.”
Electricity, he says, is what economists call a “grudge purchase.” Nobody wants to buy it — they just want the lights to stay on and the air conditioner to work. And that makes it uniquely hard to sell people on complex, abstract energy products like VPPs.
“There’s no good feeling associated with turning on the PowerPoint,” Spaccavento says. “The good feeling comes from the air conditioner when it blows nice cool air.”
A system consumers never trusted
Spaccavento argues that Australians have lost trust in the electricity market since it was deregulated 20 years ago. Consumers still believe power is ultimately a government responsibility, and when prices spike or blackouts hit, it’s Canberra that wears the blame.
“They don’t go and shout at Origin or AGL,” he says. “They go and shout at the federal government.”
While he supports deregulation, Spaccavento believes governments can’t be “super hands off” in an industry that people still see as essential. He says regulators need to actively protect consumers and help them trust that joining a VPP won’t leave them worse off.
“Governments need to find a way to break through the trust barrier and get people trying these VPPs in higher volumes, and then regulate them in a way that makes consumers feel they’ve got protections and someone on their side.”
How VPPs lose trust
The industry itself hasn’t helped. According to Spaccavento, many VPPs overpromise and underdeliver. Some operators lure customers with the promise of payments for grid support, only for those payments to vanish when price events don’t materialise or systems underperform.
“It happens with all the major VPP operators,” he says. “It happened with Reposit before we moved to No Bill. It just destroys trust.”
That mistrust, he adds, becomes self-perpetuating.
“All of this is happening in a background of, ‘I don’t trust you guys. It’s all a scam.’ Do that once or twice, and you’ve lost the consumer.”
The volatility of the National Electricity Market (NEM) makes things worse.
“It’s quite twitchy,” Spaccavento says. “It gives you all sorts of predictions, and sometimes they don’t come true, and most VPP operators leave the consumer holding the bag.”
When that happens consumers feel duped, and operators are forced to make “retention payments” to stop customers walking away. That makes running a VPP commercially difficult and erodes confidence in the entire sector.
Even before trust comes into play, most people are already overwhelmed.
“It’s a complicated space already for a consumer,” Spaccavento says. “There’s 14 brand decisions to make when they’re thinking about solar and batteries. That’s just too many.”
The process of buying and installing solar and a battery can be opaque and highly technical, then consumers are being asked to pick a VPP operator on top of that.
“More often than not, they’re saying this feels like a scam. We hear that a lot.”
Reposit’s long learning curve
Spaccavento admits Reposit learned these lessons the hard way.
“Our first products were too complicated and consumers felt they didn’t get what they signed up for,” he says. “People would say, ‘I bought this battery, it’s my battery, and I don’t want to share it with someone who’s going to make a bunch of money out of it.’”
That experience led Reposit to reimagine the entire model. Their latest product, the No Bill plan, was designed as what Spaccavento calls a “grand bargain.”
“You buy the gear, it’s your gear. Finance it however you want. And if you give us control of it, while we’re in control we’ll guarantee you no electricity bills for seven years. You can leave whenever you want.”
The model shifts the risk from the customer to the company.
“If it works, that’s great. If it doesn’t, it’s fine for you and bad for us. We take all the downsides from the system — if it’s our mistake or the market not doing what it was supposed to do — you’re still guaranteed no bill.”
Spaccavento says the approach has cut customer service costs and improved satisfaction, because customers finally feel protected from the system’s volatility.
“Our No Bill systems dance a lot harder than your standard system because we have the consumer licence to do so. They’re not left holding the bag if it all goes wrong.”
Rebuilding the social contract
For Spaccavento, the future of VPPs — and Australia’s energy transition — depends on restoring that broken social contract between households, industry and government.
“We have a generally unregulated system, and there are lots of side effects of that — all of them bad for the consumer,” he says. “Trying to change that, let alone completely disrupt it, is a huge challenge.”
As Australia moves toward a distributed, bidirectional grid where homes are as important as power plants, the question isn’t just technical, it’s cultural.
“The fact that people go straight to saying ‘all VPPs are a scam’ tells you what we’re dealing with,” Spaccavento says.
If governments and operators can’t fix that, Australia’s clean energy future risks stalling.
You can hear the full interview with Dean Spaccavento on the SwitchedOn Australia podcast.
