Why utilities will pay for the right to switch off your air-con

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NSW households invited to participate in Smart Grid Smart City trials, in a bid to reduce peak demand and keep customers happy.

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Last month we celebrated the long-overdue arrival on the Victorian retail electricity market of a smart home energy product, with the launch of Origin Energy’s ‘Smart’ technology platform. Now, households in New South Wales’ Sydney and Hunter region can get in on the action – well, sort of. Baby steps – by volunteering for a series of energy retail trials with NSW utility EnergyAustralia.

The trials are part of the federal government’s Smart Grid, Smart City Project – a three-year, $100 million initiative, spread across five sites in Newcastle, Sydney and the Upper Hunter – which will be used to test new, and presumably smarter, energy technologies, to help households better control their energy usage and costs, and to reduce peak demand on the grid.

TRUenergy subsidiary EnergyAustralia today announced it had signed up as the project’s retail partner (Ausgrid is delivering the project), and has sent out the first round of invitations to 55,000 of its existing customers, asking them to register their interest in a series of product trials which will continue until September 2013.

The product trials on offer include:

– Air-conditioning cycling, which offers rebates of between $15 and $40 (a potential $240 in total) for customers who allow their air-conditioner’s compressor to be switched off for 30 minute intervals in peak times, up to six occasions from January to March. The air-conditioner’s fan will continue to operate;

– Dynamic pricing, which offers customers a low tariff for the majority of the year and the choice to be notified by SMS before a peak pricing period occurs so they can avoid high prices by turning off appliances. (The trial will simulate 14 peak events a year, lasting from one to four hours.);

– Seasonal time of use, which offers customers no peak rates in spring and autumn, but a peak rate in summer and winter as well as the usual shoulder and off-peak rates which could save smart energy users money.

The 8,000 households that the government hopes to have taking part in the trials will also have what EnergyAustralia describes as a “new generation smart meter” installed, to allow them to monitor their energy use, costs and help save on bills.

EnergyAustralia’s group executive manager of retail, Adrian Merrick, says one of the main aims of the trial is to learn and understand what consumers want and need to reduce their bills and take control of their energy use.

“As energy costs rise, it’s important we find new ways to support our customers and that’s what these trials are all about,” Merrick said. “We want to see if these innovative offers help people better understand their energy consumption, save on their electricity bills and at the same time letting us know if the products are what our customers want in the future.”

And he’s spot on. Utilities these days should be thinking very carefully about what their customers want and need – not only to help reduce customer churn rate, as households hop from one retailer to another seeking better deals, but also to stop consumers from deserting the grid altogether, as cheaper, greener and more predictable alternative energy delivery options (not to mention cooling and heating options) become more widely available.

EnergyAustralia will be holding information seminars about the Smart Grid, Smart City trials on Thursday and Friday this week. See here for times and locations.

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8 Comments
  1. Robert 7 years ago

    Someone should investigate the waste of taxpayers money in this project. It has failed to deliver what was promised and worse still it is being portrayed as being leading edge.

    Key facts
    1. Originally a number of retailers were to be part of this – all refused including TruEnergy
    2. Ausgrid have failed to deliver on what they promised the Feds
    3. The Feds have held funds from Ausgrid because of serious problems with the project
    4. TruEnergy is only doing this because they bought EnergyAustralia (which was part of Ausgrid)- and they can just use the back office as is
    5. No other retailer would touch this project
    6. No Australian technology is being used to any material amount – most of the funds has been wasted
    7. TruEnergy can’t even deliver a billing system – its billing system project is late, flawed

    This is an example of gold plating at its best.

    A lot of spin – someone should in the Feds should explain the big blowout and what they have achieved….

    Let’s get some investigative journalism here

    Total bull !!!

    • Jim James 7 years ago

      I think I agree with Robert here.
      The Feds should just get on with funding ( like a guarantee of loans for part funding) a solar plant with dispatchable power in the Port Augusta area. $100 million would go a small in getting this started. So Labour can say they did something when it comes to generating carbon free power at the base load level.

      I was a customer of TruEnergy. From the moment I put on PV, they were not able to bill me correctly over 2 years. (Bendigo Vic).
      The idea of the ‘smart’ meter was and is good but maybe for now other things are more important to get done.

  2. Stuart Pearce 7 years ago

    I agree if Mr. Adrian Merrick would focus on making his bills accurate that would be a start. then maybe energyaustralia should give their customers an online portal to see their bills online….
    If they can’t do this… How are they going to do something more complex. if they can’t do an online portal like origin how are they going to do demand response…..

    I almost fell from my chair when I read “Using SMS ” Instead of the Internet has this article got this correct?? Who uses SMS today…. Have we just spent $100 million on old technology…
    100million for an SMS…. How funny… Next energyaustralia is going to discover that we all have facebook, twitter…

  3. John D 7 years ago

    My daily power bill is less than $3/day. So I ask you: “How much am you willing to stuff around making minute by minute changes to cut a little bit off your daily $3?”
    Any smart system has to run on automatic to be practical.

  4. Chris Mrakas 7 years ago

    I think it is very important that we all support initiatives like Smart Grid Smart Cities and I would applaud TruEnergy for participating in this. Australia is in the forefront in Smart Energy and has some truly amazing companies and innovations in this space.

    GreenBox (www.greenbox-group.com) a company that I am associated with is a leader in the Smart Energy space and is an Australian company. And for the record we have not received a penny from Smart Grid Smart Cities but would encourage governments (Lib/Labor) to undertake more of these types of initiatives. It is a chance to showcase emerging technologies and evolve thinking.

    I agree with John D , he is spot on – our design philosophy is “set and forget” and automate everything. Our technology does this today. We are working with some very enlightened companies that recognise this also. Our closed customer trials have shown that unless you automate the consumer becomes quickly disengaged. As John D says – sitting around all day to save $1 isn’t a high priority in peoples lives.

    We will be shortly announcing something big. Stay tuned.

  5. Dave Smith 7 years ago

    I think perhaps John D did not read the article very carefully.

    The first product being trialled (air-conditioner shut-off) is automatic, and pays up to $40 per half hour, six times per year. That sort of easy money should be of interest to most people.

    The second product (dynamic pricing) allows the consumer to avoid very high electricity prices by manually switching appliances off. The pricing is not mentioned, but might be 10 times the normal rate. So, again, potentially tens of dollars per day could be saved, up to fourteen times a year.

    John is thinking about a flat electricity price, where behavioural changes are pointless, as he notes. That all changes with super-peak pricing. The extent of the change is what the trial is intending to measure.

  6. Eugene 7 years ago

    I’m glad that we’re trying to move towards greener energy, cuz god knows the earth needs it sooner rather than later, but the incentives still just aren’t enough.

    Energy companies still need to protect their profits from a business stand point and consumers just aren’t getting enough incentive to go green. The quotes I’ve received, read and talked about with friends is still around $10k for a solar installation.

    But if people are serious about it, there are other ways to reduce household energy costs while having your own renewable household energy system (DIY Solar and wind etc) and not having to depend on large energy companies.

    http://Www.homemadegeneratorinfo.com has a good rundown of a couple of DIY packages with comprehensive step-by-step guides which I consider viable in reducing costs and creating your own energy, if anyone’s interested. But atleast the thought is there now with greener energy. We just need to get there now.

  7. Tim Buckley 7 years ago

    Smart meters and time of use pricing require consumer education as a key part of implementation. Given a high up front capital cost, they are not cost-effective nor desired by most low electricity users, as AGL’s recent study highlights. But they are very cost effective for large families struggling with big power bills.
    Nothing better than word of mouth communication from customers happy to save money. As such, I think this practical pilot program sounds great. I’d sign up today, if only I was an EnergyAustralia customer! But, maybe given I am a customer of TRUEnergy, and they own EnergyAustralia, I am eligible to join?? But alas, no. As Robert above points out, TRUEnergy customers need not apply! No vertical integration synergies here. No focus on customer service, just ever higher bills. Gotta love a government regulated oligopoly!

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