We can't afford to ignore energy 'demand response' again
Source: Climate Spectator, 10 Dec 2014
With current restrictions on demand response, our wholesale energy market is distorted – and consumers pay the price.
Readers with good memories might recall a couple of articles from this time last year about the proposed Demand Response Mechanism (DRM): one from AGL saying that it’s complicated and expensive, and my response highlighting the errors in AGL’s analysis.
The DRM is a reform that’s good for consumers but the energy retail and generation sector feels threatened by it – it’s competition, after all – and wants it stopped.
Last December, the gentailers prevailed: through a well-resourced, behind-the-scenes lobbying campaign, they persuaded ministers to delay the reform by a further year with (another) cost-benefit analysis.
Ministers meet again tomorrow to decide on the fate of the DRM, so it’s timely to consider a few of the questions that have been raised about it.
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