Embedded Networks can be thought of as a ‘network within a network’ and are growing in popularity as developers and consumers seek to realise the benefits of distributed generation and storage. Embedded networks were traditionally used to distribute grid-supplied electricity within a single subdivided lot (think shopping centres, retirement villages and apartment buildings) but with decreasing costs of renewable generation and storage, combined with technological advancements, embedded networks are becoming feasible in ways that weren’t possible just a few years ago. For example, Besy allows consumer devices to automatically respond to a real-time price signal and is a novel way for embedded network operators and consumers to share the financial benefit of demand reduction on an ‘opt-in’ basis.
Having worked on several embedded network projects across Australia, it is clear that this is an area where regulators and network service providers are playing catch-up. As these rules are being re-written, decisions and trade-offs are being made between the key stakeholders – consumers, embedded network owners / operators, network service providers and market operators. While protection of small customers (who often lack the resources and bargaining power of larger C&I customers) is always important, over-regulation of embedded networks assets has the potential to destroy the commercial value they offer to all stakeholders.
Do you think network operators and regulators need to step back and allow for more innovation within embedded networks, or do you think existing safeguards need to be further strengthened? Maybe we just need to change existing network tariffs to reward communities that better manage their demand? Let us know in the comments below!