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Virtual generator sitting idle

Virtual generator sitting idle

A report released today by Heather Staley Chief Executive of the Energy Efficiency and Conservation Authority (EECA), demonstrates the capability of metering technology as a key component of a demand side management system which could act as a 'virtual generator' to help businesses cope with future supply issues and ongoing price volatility.

The trial commissioned by EECA and the Ministry for the Environment extends time of use metering from a cupboard in the hall to a service that can sit on a desktop computer and send a text message or email alert to the person responsible for managing the business' costs, wherever they are.

"The really exciting thing about this technology is that it empowers businesses to make informed decisions about their energy use. Right now some large energy consumers are paged or text messaged the spot price of electricity at 5 minute intervals - but the price is only part of the business decision. The consumer also needs to know how much electricity they are using at that price," says Ms Staley.

If the amount of electricity being demanded is beyond a certain threshold, the business can check what is consuming the additional power and make a decision about whether it is worth it at the current price.

"Combining price and storable time of use information gives businesses a valuable tool with which to participate in the electricity market. Over time energy information can be easily compared and used as a key performance indicator for businesses.

"When a business is actively managing its electricity, it is making the most efficient use of our energy resource and improving its own bottom line. From a national perspective, the National Energy Efficiency and Conservation Strategy has set a target of a 20% improvement in energy efficiency by 2012, demand side management is one of the tools which will help us achieve this target.

"The next step is getting a nationwide demand exchange established. A demand exchange is a 'virtual generator'; a web based electricity trading exchange on which customers are paid to reduce their demand at peak times. A report commissioned by EECA late last year shows we have a 250 - 900MW capacity that we can call on in times of high demand to help manage peak loads. "The tools that are being developed for the demand side in New Zealand are world class. Traditionally the focus has been on electricity supply yet New Zealand is in a prime position to take advantage of demand side participation.

"It's time for the electricity industry to get in behind this technology and allow medium and large electricity users to be active participants in the electricity market through a demand exchange," Ms Staley said.

Copies of the preliminary report on the trial 'demand side management in real time' are available on EECA's website The trial was sponsored by EECA and the Ministry for the Environment, and was conducted by Energy Intellect Ltd with assistance from Vector Ltd and Stream Information Ltd. Six industrial and commercial sites are involved, including manufacturers, a University IT department and offices.

EECA is working to improve energy choices by promoting and supporting the uptake of energy efficiency and renewable energy initiatives. For more information on EECA visit

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