PDRS Battery Program Announced, Plus Changes to Existing Activities

Changes to the Peak Demand Reduction Scheme Announced

This morning (24 May 2024) the NSW Government announced upcoming changes to the Peak Demand Reduction Scheme (PDRS) program, due to come into effect in two stages between 01 August and 01 November this year.

The highly anticipated Battery program is included within this change, allowing an upfront discount of $1600-2400 to be passed onto consumers when a battery is installed, and an additional $250-400 when the battery is connected to a Virtual Power Plant (VPP). 

Background

The PDRS is a NSW Government initiative that aims to reduce peak electricity demand through a certificate scheme incentivising technology upgrades and installations that reduce peak demand. These technologies are known as ‘eligible activities’. When an installer undertakes an eligible activity, a series of documentation and photos are gathered and submitted to Accredited Certificate Providers (ACPs) such as Ecovantage. Ecovantage verifies the information provided and creates a number of Peak Reduction Certificates (PRCs) based on the calculated energy savings the activity has caused. These certificates are traded with Liable Entities and allow a rebate to be paid back to the installer. This allows the consumer to access an upfront discount on the technology installed, reducing the barrier to entry. 

The policy surrounding the Peak Demand Reduction Scheme is known as the ‘PDRS Rule’, and undergoes a review and changes annually. The review often results in amendments to existing activities, removal of existing activities, and the introduction of new activities. For the 2024 Rule change, the review and outcomes are summarised below. 

Future Methods

In the initial consultation, the NSW Government proposed the Wholesale Annual Response Mechanism – known as the WARM Method. This method is designed to incentivise the availability of demand response capacity from Large Energy Users (LEUs). The WARM method would allow registered assets to create PRCs on an annual basis, based on their maximum capacity dispatched within a peak period each year. 

The department will conduct further rounds of consultation on the WARM method prior to its introduction into the program. A primary reason attributed to the delay of the program is a concern about the additionality of existing assets that would have been eligible for PRC creation under the proposed method. The department has disclosed that they do not have visibility over existing capacity installed that is not yet registered within the Wholesale Demand Response Mechanism (WDRM), creating uncertainty around the potential for PRC creation and bringing into question the benefit method to new versus existing assets. 

Further consultation will include data gathered on out-of-market contracted capacity within retailer portfolios, allowing for greater visibility and more tailored eligibility requirements of the method.  The department has stated that this will ‘offer a platform to conduct streamlined measurement and verification activities for a wide range of loads, enabling the participation of temperature sensitive loads’.

How Ecovantage Can Help

As one of the most experienced Accredited Certificate Providers under the NSW Programs, Ecovantage welcomes the above changes and is well-equipped to support installation companies in leveraging new and existing activities in the Peak Demand Reduction Scheme.

To ensure your business is ready to provide the incentives available in the Battery program and adapt to existing activity changes, get in touch with us today.

Speak with a PRC Specialist