United in demand response: the power of 660,000 Victorian consumers

Of all the ten demand response projects that make up the program being introduced this summer, the one put forward by United Energy involves involves by far the most customers.

The only question is whether any of them will even notice.

United Energy is a power distribution business – it owns and operates the ‘poles and wires’ used to transport electricity from substations into homes across a large swathe of suburban Melbourne and the Mornington Peninsula.

Although most of them probably don’t think about it very often, around 660,000 Victorians receive electricity when they switch on an appliance because it is carried to their home by United Energy’s distribution network.

And a small but complex and ingenious change to that network is behind one of the founding projects in the three-year trial demand response program being brought to you by ARENA and AEMO this summer.

The program, to which ARENA has contributed $28.6 million of a total $35.7 million, aims to help to ensure energy supply is reliable and stable during times of peak demand, such as summer heatwaves or extreme storms.

The remaining $7.2 million has been provided by the NSW Government for projects based in NSW.


By reducing demand, a move that has been extremely effective elsewhere in the world, the program aims to also reduce the need for costly new power generating and distribution infrastructure to be built merely to cater for the handful of times each year when demand spikes and supply struggles to keep pace.

Eight innovative companies, across different parts of the energy sector, have been selected for funding. Together, they will remove 143 MW of demand from the electricity grid this summer and 200 MW by year three of the project.

Infographic: Demand response helping to secure the grid by December 2020
Infographic: Demand response helping to secure the grid by December 2020.

While many of the projects in the program require multiple interactions, decisions and behavioural changes from both energy consumers and companies that help supply them with electricity, United Energy’s $5.76 million project instead relies upon system-wide change.

At substation level, during times when a demand response event is initiated by AEMO, United Energy will reduce the voltage of electricity it supplies to the homes of all the households and businesses it services.

Every single one. All 660,000.

“United Energy’s demand response project is innovative because it’s a network wide program,” the company’s Rodney Bray says.

“It looks at utilising the Victorian smart meter rollout to actually allow us to adjust voltages on the distribution network.”

Voltage will be reduced from 240 volts to around 230, although the amount of reduction will differ across various points of the distribution network. A reduction of this nature, while not advisable in the long term, can safely and securely be carried out for a short period without any negative consequences.


For the householder, nothing observable changes. Lights will not flicker and dim, appliances will continue working uninterrupted. But while individual consumers will most likely never notice, the overall impact will be great.

“A very small, marginal decrease in the voltage actually has the impact of providing a substantial amount of demand response,” Bray says.

“The customer’s experience remains unchanged. Essentially all their appliances will operate in the same way they usually do.”

Electrician installing a smart meter
Smart meters such as this one are what make United Energy’s project possible. IMAGE: United Energy.

How it works

It’s an idea that might appear simple and seamless to consumers but has a lot of complexity and ingenuity behind it.

While it has long been possible to make such an adjustment in voltage, the difficulty lay in making sure adjustments at substation level across different points in the system were coordinated in order to provide the ideal level of system-wide voltage drop.

Without detailed feedback, and a way of coordinating varying voltage changes at different substations it was not possible to make the change without a risk of negative impacts on customers and the network.

But the installation of smart meters in recent years, in this case by the Victorian Government, that has changed all that. The meters, which are installed in all Victorian homes, will feed back information to the United Energy control centre.

There, an algorithm will use that information to control the individual voltage reductions at each substation, tailoring them so that each part of the network achieves a safe level of reduction and the cumulative effect of those reductions produces the overall desired voltage drop

This process is expected to deliver 2-3 per cent of energy savings during a demand response event.

“That will translate to 12 MW of demand across our distribution service area in the first year,” Bray says.

“That equates to about 10-20,000 homes that could potentially be supplied in the event of a generation shortfall.”

By year three the project expects to deliver 30 MW of demand response.

“It’s a very exciting opportunity for us to get involved in an industry wide program that can allow us to expand on our capabilities in demand management,” Bray says.

Who participates?

The project will be used on each and every one of United Energy’s 660,000 customers. Of those, around 90 per cent are residential customers and the remainder are a mix of smaller and large businesses and agricultural producers.

“One of the challenges distribution businesses have faced is that whenever there is a capacity constraint there has been a need to upgrade the network with poles and wires,” Bray says.

“What we like about demand response is it gives us an additional lever to manage those challenges. DR allows us and our customers to get involved with proactively managing demand.”


Infographic: Demand Response how it works
Infographic: Demand Response how it works.

This article was originally written by Daniel Silkstone, former Head of Content, ARENA.