The Australian Energy Market Commission (AEMC) has released a draft rule to create a wholesale demand response mechanism for public consultation.

The new rule would allow non-retailers to offer demand response directly into the wholesale market for the first time. This would allow large commercial and industrial customers to be paid more easily for demand reductions in the wholesale market.

Both the Finkel review and Australian Competition Consumer Commission's Retail Electricity Pricing Inquiry recommended that wholesale demand response mechanism be established to improve reliability and reduce wholesale prices.

The draft rule would put demand response on a more even footing with generation in the wholesale market, increasing competition leading to lower prices for everyone.

The Australian Government welcomes the draft rule & encourages all stakeholders to contribute to the AEMC's consultation process.

The Australian Government is getting on with the job of delivering more affordable, reliable energy for families and small businesses. This proposed rule change builds on action already taken by the Government to empower consumers to get a better deal, and increase the availability of dispatchable resources in the wholesale market to keep the lights on and bring prices down.

The draft determination is available at aemc.gov.au/rule-changes/wholesale-demand-response-mechanism.