AGL Energy and the Australian Renewable Energy Agency (ARENA) have partnered to develop and trial a price intensity forecasting tool that will dynamically manage flexible loads to test improving the utilisation of renewable energy in the National Electricity Market (NEM) and reduce costs for large commercial and industrial customers.

Working with four commercial and industrial trial participants, comprising of Melbourne Airport, a warehouse and logistics company, a tier 1 supermarket chain and a water utility company, a price intensity forecast is being trialled to dynamically manage flexible loads to maximise renewables utilisation in the NEM.

The $1.8 million project relies on a seven-day ahead price intensity forecast, rather than the real-time NEM price, allowing the customers to prepare for later load reduction activity by flexing the load both up and down throughout the day.

With the estimated potential NEM-wide load flexible capability of these industry sectors to be approximately 385 MW, AGL and ARENA will explore the commercial benefits to determine the applicability for other large commercial and industrial customers.

AGL Chief Customer Officer, Jo Egan, said the two-year project will allow AGL to assess the implications of dynamic flexible loads on energy pricing and the potential benefits of load flexing.

“This trial marks the first step in AGL developing a load flex product for our commercial and industrial customers and demonstrates our commitment to helping our customers decarbonise the way they live, move and work,” Ms Egan said.

“Flexible demand projects like this enable AGL to develop our technological expertise in harnessing renewable energy while also exploring novel ways to reduce customer costs. We look forward to sharing the knowledge of the trial with ARENA and our participating partners to optimise the transition to renewable energy.”

ARENA CEO Darren Miller said flexible demand offers a viable solution to the evolving requirements of the electricity grid.

“Through AGL’s trial, the development of the price intensity forecasting tool will help to reduce barriers for industry to take up renewable energy, shifting usage to times which can lower power bills and reduce strain on the grid. We look forward to seeing the end results of the project which will assist other sectors in their own energy transition.”

The storage intensive nature of the targeted industries are ideal participants for the research as they are identified for the potential to flex load without adverse outcomes to their productivity.

The Dynamic Pricing Load Flex project commences with the development of the software and hardware early next year, with the findings to be ready to be shared mid-2025.