Rooftop solar and other DER – such as storage and demand responsive appliances – have a multitude of benefits for the system. DER have the potential to provide electricity and services to the grid in times of need. They can decrease the necessity for centralised generation and can therefore reduce wholesale power prices. They can reduce reliance on high-cost electricity networks if managed well. They can also introduce resilience into the system and provide sustainable jobs and economic opportunities across Australia.

However, the full potential of DER is yet to be unlocked. For technical, regulatory and/or market design reasons, DER are not able to provide the full range of possible services to the grid. The desirable end state is a sharing energy economy in which DER are in communication with one another behind-the-meter (BTM) and with the grid, and can trade energy services with one another, the local distribution network and the grid, in a voluntary but profitable manner. This will benefit the grid and deliver lower costs for all users of the electricity system.

Key findings:

• Distributed Energy Resources (DER) can unlock faster decarbonisation and lower energy bills by leveraging household and business investment, increasing the chances of Australia reaching 82% renewables by 2030.
• A DER Authority should be established, responsible for technical standards, to optimise the value of DER, including electric vehicles.
• To make the most of renewable power, accelerated action is needed to scale both flexible demand and storage.
• A review of energy market governance is needed to support a sharing economy for energy, while a review of distribution network revenue regulation is necessary to ensure distribution networks are remunerated efficiently in a DER-rich world, and that DER can provide network services on a level playing field.