The Smart Energy Council has released a new report examining the barriers and opportunities affecting commercial and industrial distributed energy resources in Australia.
Unlocking the Missing Middle: Commercial and Industrial Distributed Energy Resources in Australia focuses on the 100 kW to 30 MW market segment, which sits between residential rooftop solar and utility-scale renewable energy projects.
While Australia has seen strong uptake of residential solar and continued growth in large-scale renewable energy, the commercial and industrial market has not developed at the same pace. This segment includes businesses, industrial facilities, warehouses, farmsheds, schools, shopping centres, commercial buildings and other organisations that could benefit from on-site solar, battery storage, flexible demand and energy management technologies.
The report considers why this part of the market has not scaled in line with its potential and identifies areas where policy, regulatory and market settings could better support investment.
The report forms part of the Smart Energy Council’s ongoing policy and advocacy work to identify reforms that support greater deployment of renewable energy and storage across all parts of Australia’s energy system.
Building an industry evidence base
The report brings together several sources of evidence to provide a clearer picture of the commercial and industrial distributed energy market.
This includes:
- a literature review of more than 80 Australian and international publications;
- a survey of 61 Smart Energy Council members working across the sector; and
- in-depth interviews with ten industry practitioners involved in the development, design and delivery of commercial and industrial energy projects.
The research examines the practical experience of businesses working in the sector, including the factors influencing project development, investment decisions and deployment.
Released to Smart Energy Council members as an exposure draft, the report provides members with access to the detailed findings, supporting evidence and proposed reform priorities.
Why commercial and industrial distributed energy matters
Commercial and industrial distributed energy resources can play an important role in Australia’s changing energy system.
For businesses, solar, storage and flexible energy technologies can help manage electricity costs, improve energy resilience and support emissions reduction objectives.
At a broader system level, increased deployment in the commercial and industrial sector can support more flexible electricity demand, make better use of existing network infrastructure and contribute to the integration of renewable energy.
However, projects in this market are often more complex than residential installations. They may involve larger connection requirements, more detailed commercial arrangements, different electricity tariffs and multiple decision-makers, including landlords, tenants, building owners, energy users and network businesses.
Understanding these challenges is important to developing practical and workable reforms.
What the report explores
Drawing on industry experience and research, the report examines a range of issues affecting commercial and industrial distributed energy projects, including network connection processes, electricity tariff design, investment settings, access to energy data, and commercial arrangements between building owners and tenants.
Supporting policy and advocacy
The Smart Energy Council will use the report to inform its ongoing engagement with governments, regulators, network businesses and industry stakeholders.
The work is intended to support evidence-based discussions about how commercial and industrial renewable energy and storage projects can be enabled more effectively across Australia.
The exposure draft process also provides Smart Energy Council members with an opportunity to consider the report’s analysis and contribute further industry experience before the work progresses.
The Council thanks the members who completed the survey and the industry practitioners who contributed their time and insights through interviews. Their experience has helped shape the report and will support the Council’s future advocacy on behalf of the sector.
Access for Smart Energy Council members
The report, member brief and supporting literature review are available exclusively to Smart Energy Council members.
Smart Energy Council membership provides access to policy analysis, industry research, member briefings and opportunities to contribute to the Council’s advocacy work.
Organisations interested in accessing this report and continuing to receive member-only industry information can learn more about becoming a Smart Energy Council member.
