EECA is partnering with six Electricity Distribution Businesses (EDBs, or lines companies) on a series of Flexibility Pilots to test how smart technology and flexible electricity use can reduce peak demand, improve network resilience and help lower consumer electricity costs.
Piloting flexible electricity in New Zealand
These pilots are demonstrating how energy resources like solar panels, batteries and smart devices in homes, businesses and communities can reduce peak demand, improve network resilience, and defer traditional network investment.
The pilots will incentivise customers to take part by subsidising flex ready technology — such as smart controllers for existing technologies like hot water cylinders and heat pumps. Some homes will also receive solar and batteries, depending on the pilot. Some pilots will test flexible electricity use in industrial and commercial settings.
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The opportunity for flexible electricity
Flexible use of electricity (including how and when it’s used), offers a clear opportunity to support a more resilient, affordable, and low-emissions electricity system in New Zealand.
Rather than building new infrastructure to meet relatively short periods of peak demand, flexible electricity use can shift some electricity consumption to times when electricity is cheaper, the network has more capacity or renewable electricity is more abundant. EECA analysis estimates that uptake of flexible energy use could shift up to 1,900 MW of demand away from peak periods - saving New Zealand up to $3 billion on electricity generation and infrastructure.1
The challenge now is to understand what works in practice in New Zealand, how different models create value for consumers and networks, and what technical, commercial and regulatory settings are needed to enable flexibility to scale with confidence.
About the community pilots
The 6 pilots will help build an evidence base for how flexible electricity use can work at scale across homes and businesses in New Zealand communities.
Each of them explores different combinations of smart technology, incentives, and customer offers, while applying a more standardised approach to data collection and evaluation.
The pilots will also test common open communication protocols (OCPs), aligned with international standards, at the system level between electricity networks and flexibility providers. OCPs are necessary to enable full market participation by ensuring that everyone is using the same language to communicate.
The challenge for flexibility is coordination
Many households and businesses are already struggling with rising electricity costs. But most already have assets capable of flexible operation, like heat pumps, EVs, and solar and batteries. The missing piece is often not the technology, but both the coordination across the sector and the development of a functioning flexibility market.
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Electricity distributors
Need to clearly signal where and when flexibility is required — for example, reducing demand in a constrained area at 6 pm.
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Retailers and flexibility providers
Need to translate the flexibility requirement into an offering that fairly rewards customers for changing when or how they use electricity.
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EECA pilots
Testing which settings could generate the most value for both electricity users and the country. For example, where clearly signalling critical peaks or other approaches to pricing might influence household electricity use.
From proof of concept to scalable pilots
The six community pilots build on our FlexTalk trial with the Electricity Engineers Association. Nearly 150 households taking part in Flextalk have received a home energy management system (HEMS) and smart controls retrofitted to their heat pumps, hot water cylinders and – in some cases – solar panels.
What we learn from these trials will help inform future policy settings, product regulations and recommendations, with the aim of successful approaches being replicable across New Zealand.
This work is relevant to the wider sector because it focuses on moving beyond isolated trials toward repeatable, scalable models, helping clarify what needs to be standardised, what systems and processes are required, and how value can be clearly delivered to consumers and all other actors across the electricity system value chain.
EECA’s wider work in flexible electricity use
EECA is using targeted investment, research, regulation and real-world demonstration to understand what is needed to scale flexible electricity use across New Zealand.
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Demand flexibility in end-use products
EECA is supporting the development and uptake of end-use products that can use electricity flexibly, across the residential, commercial, and industrial sectors.
This work links to wider policy decisions and regulatory changes that are progressing across government. -
Understanding the potential of two-way EV chargers
Electric vehicles have the potential to play a broader role in the Aotearoa energy system, beyond transport.
EECA is trialling the use of two-way chargers in real-world settings to better understand how this technology works and how households and businesses can use it effectively. -
Unlocking the potential of demand flexibility in homes
Harnessing modern technology has the potential to make the energy system more resilient and affordable.
A green paper sought feedback on how to unlock the potential of demand flexibility through products and appliances used in homes.