Local Energy Market

Local Energy Market (LEM) enables participants to trade energy amongst each other through our trading platform, matching buy and sell offers in forward facing time intervals. Buyers bid in the LEM at buy rates lower than their grid tariff rate, while sellers bid at rates above prevailing feed-in-tariff. The traded volumes are indicated to the retailer(s) or distribution companies at the awarded prices to be reflected in the energy bills. LEM encourages local generation and less import from the bulk electricity system.

LEMs help in limiting both import and export to the bulk electricity system. LEMs are highly responsive to the variations in supply and demand and reduces exports to the bulk electricity system. This results in savings for network operators like the distribution utilities. They also help reduce draw from the bulk electricity system which means they help reduce energy consumption costs for the consumers and prosumers.

Benefits of LEM

  • Relieves grid congestion and supports voltage management through peer to peer (P2P) trading.
  • With existing standard network pricing, it will encourage grid utilisation which vastly reduces curtailment costs as well as reduces the need for flexibility services.
  • With locational value pricing it will increase grid utilisation. Tariff restructuring would further enhance the benefits of a LEM as it promotes close proximity trading, thus reducing grid exports and imports even further.
  • Consumers without financial strength to procure photovoltaic (PV) and battery storage, can buy at lower P2P rates compared to grid tariff rates. Prosumers with PV and battery storage can sell at higher rates than the feed-in tariff.
  • All consumers and prosumers stand to gain benefits. The prosumer with a battery energy storage system gain the most, with a reduction in their energy bill and shorter payback period for the battery.

Case studies

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