EXPLORE KNOWLEDGE BASE
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CERI Knowledge Base
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About the CERI knowledge base
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Introduction to Australia’s electricity markets
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Australian consumer insights
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CER technical and interoperability standards
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Connecting a customer to an electricity network
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Connecting a generator to a distribution network
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Utility interconnection (CSIP-AUS)
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Dynamic network export and generation control schemes
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Network load control schemes
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Network tariffs and network support services
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Participating in the National Electricity Market
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Participating in a frequency control market
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Participating in the RERT
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Participating in the Wholesale Electricity Market (Western Australia)
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Participating in the I-NTEM (NT)
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Cyber security and data privacy arrangements
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Consumer protection frameworks
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Registering as a demand response service provider
Last Updated on 24 July 2026
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A demand response service provider (DRSP) can aggregate and bid flexible load reductions into the wholesale market without becoming the customer’s FRMP, and without needing to create an embedded network.
Key points
- A DRSP can bid reductions in customer electricity demand into the wholesale market.
- Participation occurs through the Wholesale Demand Response Mechanism (WDRM).
- Settlement compares actual consumption with an AEMO-approved baseline.
- Participating loads must meet metering, baselining, dispatch, telemetry and consent requirements.
- Wholesale demand response is primarily used by large, flexible commercial and industrial loads.
How does the WDRM work?
Under the WDRM, market settlement is based on an AEMO-approved baseline. The customer’s FRMP is settled as though the customer consumed the baseline amount, while the DRSP is paid for the difference between the baseline and the customer’s actual metered consumption during the relevant dispatch intervals.
The WDRM does not provide any mechanism for DRSPs to receive network charge rebates. Network tariff benefits remain with the FRMP and are passed to customers under standard or negotiated commercial arrangements.
What is required to participate as a DRSP?
A DRSP bids and receives dispatch instructions for WDRUs and is responsible for meeting all performance, metering, telemetry and compliance requirements under the WDR framework. Multiple loads may be aggregated into a single WDRU, subject to connection-point and classification rules. AEMO assesses WDRUs for participation based on load predictability, baseline accuracy and bias controls.
Key requirements for WDR participation include:
- Metering: Both the market meter and any child meter used for WDR must be a Type 1–4 Meter capable of providing interval data suitable for baselining and dispatch verification.
- Baseline methodology: Each WDRU must use an AEMO-approved baseline, with ongoing accuracy and bias testing.
- Dispatch conformance: DRSPs must ensure WDRUs follow AEMO dispatch instructions and must report non-conformance events.
- Telemetry: Real-time telemetry may be required depending on the configuration, aggregation level and whether AEMO needs visibility for dispatch conformance.
- Customer consent: DRSPs must obtain explicit consent from the customer at the market connection point before enrolling a load in a WDRU.
WDR participation is most common for large, flexible commercial and industrial loads, such as cold storage facilities, water pumping and sewerage systems, data centres, and commercial HVAC.
Most activity remains concentrated in sites capable of delivering ≥ 1 MW of controlled response. Uptake among smaller loads has been limited due to baselining concerns and exclusions for small customers.