There's a big difference (!) between talking about a new electricity market and actually getting one up and running.
In August, Our Energy took an important step toward establishing a local flexibility market in New Zealand by launching the first Localflex competitions.
It was a huge milestone we'd been working towards for some time, alongside electricity distribution businesses (EDBs), flexibility service providers (FSPs), our global technology partner EPEX SPOT and a whole lot of people across the sector who share our belief that there's a smarter way to manage our electricity system.
And while getting to launch was a significant achievement, the really interesting part is what happens when you put a new market into practice.
One thing we've always recognised is that you can't build a functioning flexibility market on theory alone. You need electricity networks willing to bring real opportunities to market. You need flexibility providers willing to explore how their energy resources might respond to those opportunities. And you need a shared framework that lets everyone participate.
Our first competitions brought those pieces together. Across 20 competitions, participating networks put approximately $1.8 million in potential flexibility payments on the table, with 41 flexibility service providers registered on the platform.
Those numbers are encouraging, but for us, the real value lies in the practical experience we've gained together. We've now had the opportunity to see how the market works in practice, where the challenges are and what needs to happen to make participation easier. That's something you simply can't replicate through planning and discussion alone.
Over recent weeks, we've been sitting down with EDBs and FSPs to understand their experiences and gather feedback. A few things really stood out.
Firstly, standardisation matters. If we're going to build a market that works at scale, we can't expect flexibility providers to navigate a completely different set of requirements for every electricity network. Common agreements, processes, and market infrastructure are an important foundation.
Secondly, participation takes preparation. Flexibility providers need time to assess opportunities, engage customers, understand commercial arrangements, and prepare their resources. Earlier engagement and clearer information really make a difference.
And thirdly, flexibility isn't one-size-fits-all. Batteries, EV charging, hot water, commercial loads and other flexible resources all have different capabilities. The products and opportunities we bring to market need to reflect that.
None of these insights is particularly surprising on its own. But there's a big difference between understanding something in principle and having real experience to inform what you do next. That's what makes this first round so valuable.
Something we’ve really appreciated throughout this process is organisations across the sector's willingness to step forward and try something new.
Our participating EDBs have played a huge role in bringing genuine flexibility opportunities to market. And the FSPs who have engaged with Localflex are helping us understand what participation looks like from the other side.
As Localflex's exclusive distributor in Australasia, we're also extremely fortunate to be working with EPEX SPOT, whose internationally proven market infrastructure and experience have been instrumental in bringing Localflex down under. But we’ve learnt that technology alone doesn't establish a market!
It takes genuine trust, collaboration, practical experience and organisations willing to work through the challenges together. Thank you to everyone who's been part of that process.
The next phase is about putting what we've learned to work. We continue to work with EDBs and FSPs to refine the processes, improve the experience of participating and explore how flexibility opportunities can become more accessible and commercially viable.
There's still a heap of work to do. But that's the nature of building something new. As more renewable generation, batteries, EVs and other flexible resources connect to our electricity system, the opportunity to make better use of what we already have will only grow.
And if we want to manage that transition affordably, we're going to need new tools and new ways of working alongside the infrastructure investment that networks will continue to make. Localflex is one part of that future.
We've taken the first step, learned a great deal and gained a much clearer picture of what needs to happen next. We've moved beyond the talking and into the doing. Now the focus is on making this market work in practice, and the strength of that work lies in the sector building it together.
John Campbell
Founder & CEO, Our Energy