Peer-to-Peer Energy Market Emerging as a Reality for Australia
With the rise in popularity of renewable energy alternatives, more and more households are becoming energy “prosumers” – meaning they are both consuming and producing energy. Start-up companies are beginning to tap into this market, creating platforms that allow these prosumers to sell their excess energy to other consumers in the area.
Peer-to-peer energy markets are popping up around the world, with start-ups in the United States, Europe, New Zealand, and now, in Australia. In December, LO3 Energy, the company behind the Brooklyn Microgrid, opened a new office in New South Wales to introduce this “TransActive Grid” technology to Australian consumers.
“The main driver for the project is resiliency in the face of grid events,” said LO3’s founder and Chief Executive Officer Lawrence Orsini. “Keeping facilities that are critical for the health and well-being of the community up and running will be the focus at any stage of the development.”
The infrastructure offered by LO3, though, aims a bit higher – the company’s “microgrid” is moving toward an innovative system where individual consumers can fully own the electricity generated by their communities, providing them with the power to determine how the energy will be distributed and, hopefully, encouraging more investment into renewable sources.
However, according to Belinda Kinkead, the former environmental finance professional who is now heading up LO3’s Australian office, the regulations and policies currently in place in Australia have stymied some efforts to introduce community energy sharing and distribution.
“The Brooklyn Microgrid was only made possible because of progressive changes in policy and the engagement of the progressive utility companies,” Kinkead said. “We hope that we can achieve similar cut-through in the Australian market, as believe we can develop the TransActive Grid to offer a win-win situation for energy regulators, consumers, and producers large and small.”
Kinkead said the plan for Australia isn’t about competition between utility companies, but rather to develop a partnership that integrates the peer-to-peer network seamlessly into the energy market in a way that will benefit both energy companies and energy consumers.
“(Energy companies) know they need to adapt to stay alive in a rapidly changing industry,” said Orsini. “This is a necessary evolution to the energy markets. People want more choice in where and who they get energy from – and buying energy from your neighbours or your community is surely the best way to do it.”
The idea isn’t entirely original – last August, a start-up located in Perth, Power Ledger, began conducting peer-to-peer trials in the area. LO3, however, has the advantage of proven success already in the United States. Either way, consumers in Australia will benefit from having this new technology brought to their doorsteps – whether they are generating energy themselves or not.
“Effectively, we’re cutting out the middle-man to save consumers, and to maximize returns for producers,” said Jemma Green, one of the co-founders behind Power Ledger. “It’s a win for the people who have been able to afford to invest in roof-top solar, but also a win for customers who haven’t: they will be able to access clean, renewable energy at effectively a ‘wholesale’ rate. Everyone wins.”