Deakin University, with funding from Energy Consumers Australia and leveraging the Powertracer software platform, has initiated a pioneering trial exploring virtual energy networks (VENs) across Australia’s National Electricity Market (NEM). This innovative concept aims to revolutionize how households and small businesses directly trade excess rooftop solar energy, fostering a more decentralized and democratic electricity market.

VENs operate as online platforms, enabling consumers to buy and sell electricity directly, much like a local exchange. This model offers dual benefits: households without solar can access cleaner, potentially cheaper power, while solar producers can secure better prices for their surplus generation compared to standard retailer feed-in tariffs. Associate Professor Dr. Andrea La Nauze, lead researcher on the Deakin trial, emphasized on the SwitchedOn Australia podcast that it “makes sense that you’re looking to get a better deal than what you would be buying under your usual contract.” While some multi-site businesses already utilize VENs, widespread residential adoption has been limited by incumbent energy retailers.

The Deakin trial is actively recruiting up to 400 households and businesses within Queensland, New South Wales, ACT, Victoria, Tasmania, and South Australia, requiring participants to have a smart meter and be customers of Energy Locals, a retailer known for its transparent, subscription-based model. Participants can opt for peer-to-peer trades with specific individuals or community trades, buying from or selling into a state-based pool at a nominated price. Once preferences are set, the system operates automatically, offering a “set-and-forget” solution, according to La Nauze.

Beyond direct financial benefits, the trial seeks to demonstrate VENs’ broader system-wide advantages. By incentivizing non-solar households to shift energy consumption to midday, when rooftop solar is abundant and cheap, VENs can help absorb excess solar generation, reducing curtailment and alleviating grid stress. “It’d be really interesting if we’re able to demonstrate that access to this type of trading platform increases the consumption of people buying energy in the middle of the day,” La Nauze noted. This consumption shift could lead to lower energy prices for all consumers by optimizing grid utilization and avoiding peak load issues, with benefits eventually flowing through as “cheaper network prices.”

A critical hurdle, however, lies in Australia’s current network tariff structure. Participants in a virtual energy network still incur full network charges, regardless of the proximity of their trading partner. Ezra Beeman, CEO of Empower Energy and Managing Consultant at Energeia, highlighted this inefficiency: “If you import 1 kWh from the grid, potentially from your neighbour… you will pay for the high voltage, sub-transmission and transmission networks as well, even if not using them for this service.” This “tariff trap” significantly undermines the economic case for local energy trading. Beeman argues that reforming these tariffs to reflect the true cost savings of local consumption is the “most important change needed,” as it would unlock the full economic potential of decentralized energy.

The Deakin study builds on the successful Winzero pilot in NSW, which has seen around 40 sites trading solar for over a year, demonstrating the technology’s usability and community success. Unlike centralized virtual power plants (VPPs), VENs offer greater user autonomy, allowing participants to retain control over their assets and set their own trading terms. This flexibility is key to integrating more rooftop solar without individuals relinquishing control. The model also presents opportunities for donating excess solar to charities, further democratizing clean energy access. The research team is particularly keen to recruit non-solar households and businesses to ensure a balanced and robust marketplace.