Smart grids: A path to neighbourhood energy independence

BACK IN 2006, I established the Smart Grid Australia Association. Here, we brought together organisations involved in the development of smart energy, working collaboratively to build smarter communities.

Our major success was the government’s decision in 2010 to launch a $100 million Smart City Smart Grid pilot in the Newcastle area.

Unfortunately, this initiative was immediately cancelled when the Coalition Government came to power in 2013. For the next ten years, energy policies remained in limbo under that government.

On the positive side, the pilot propelled Newcastle to become one of the leading smart cities in Australia.

But as is often the case – for such smart grid smart city projects on a larger scale – many more ducks need to be aligned to establish real, large-scale commercial projects.

With  the latest developments in smart grids, smart meters, and batteries, we are now getting closer to realising the benefits of such complex systems.

As someone who has written extensively about the transformative power of smart grids and localised energy systems, I believe we are standing at a pivotal moment in energy innovation.

The rise of renewable energy – paired with smart technology – offers an extraordinary opportunity to empower communities, enhance sustainability and reduce costs.

However, as I’ve observed in both Australia and internationally, achieving this vision requires not only technological solutions but also robust regulatory frameworks to protect consumers and foster fair competition.

I was triggered to revisit these issues after reading this recent ABC article.

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A Smarter, Cleaner Future

Smart grids have the potential to revolutionise how we produce, store, and consume electricity.

These systems enable real-time communication between utilities and consumers — optimising energy distribution and reducing waste.

Neighbourhood energy systems take this concept further by allowing communities to manage energy collectively, leveraging shared infrastructure — such as community batteries.

I’ve highlighted examples in the past, such as Australia’s Hornsdale Power Reserve (2017), which shows how large-scale battery storage can stabilise the grid and support renewable energy integration.

But even more exciting is the potential for neighbourhood-level systems where shared batteries or virtual power plants could provide resilience and cost savings. Imagine a street or suburb pooling solar energy and storage to weather peak demand or blackouts — a vision that is becoming increasingly achievable.

Learning from International examples

Over the years, I’ve also drawn attention to international models that inspire us to think bigger.

In 2016, I wrote about blockchain opportunities, a prime example here is the Kitakyushu Smart Community project in Japan. This initiative integrates renewable energy, storage, and demand-response systems to create a sustainable urban energy model.

Similarly, the Brooklyn Microgrid Project in the United States demonstrates the power of decentralisation, where residents generate, store, and trade energy locally using blockchain technology.

These examples prove that the localised energy systems we advocated for more than a decade ago here in Australia are not only viable but also scalable.

Newcastle: Leading the way for Australian smart cities

Newcastle’s transformation into one of Australia’s leading smart cities should be an inspiration for others to follow suit.

Challenges and the need for regulation

Thanks to party politics, Australia suffers from a knowledge and experience gap of more than a decade — and we must catch up to avoid repeating the mistakes highlighted in the ABC article.

While the potential is immense, I’ve often warned that regulatory gaps could undermine these advancements.

The control of energy data by metering companies – as seen in Australia – creates monopolistic “walled gardens”, restricting access to critical information and stifling competition.

Consumers are left unable to fully leverage their energy systems — and third-party innovators are shut out.

Smart energy can deliver lower costs, but we need to ensure those benefits flow to the consumers.

This is why I strongly advocate for transparent regulations that prioritise consumer rights to data access. Without these safeguards, the energy transition risks becoming more expensive and less equitable.

I’ve seen how these challenges play out globally, and it’s clear that without intervention, the benefits of smart grids and localised systems could remain out of reach for many.

The role of ISP-like resellers in energy innovation

In my earlier work, I’ve drawn parallels between energy systems and the internet.

Just as internet service providers (ISPs) aggregate bandwidth to serve multiple customers, energy resellers could combine distributed energy resources like solar panels and batteries to create neighbourhood-scale virtual power plants.

This model could stabilise local grids, reduce reliance on centralised power plants, and democratise access to renewable energy benefits.

I’ve long argued that this ISP-like approach can lower barriers for communities that lack resources for individual systems. By coordinating energy generation and consumption at the local level, such systems could unlock significant savings while enhancing grid reliability.

Unlocking the path toward a sustainable energy future

Grid flexibility measures and distributed energy resources are key elements for creating a more sustainable and reliable energy system.

My Vision for the Future

Reflecting on the lessons from Australia and international examples, I firmly believe that we can pick up where we left off in 2013 and accelerate progress based on new knowledge and global developments.

We can and should build a smarter, cleaner, and more equitable energy future.

Policymakers must step up to address the regulatory void in smart meter markets and ensure fair access to energy data. This is not just about technology — it’s about empowering individuals and communities to take control of their energy destiny.

The success of projects like Kitakyushu and Brooklyn shows us what is possible when innovation meets thoughtful regulation. I believe we can apply these principles to create resilient neighbourhood energy systems that not only reduce costs but also enhance sustainability.

By embracing these ideas, we can ensure that the energy transition benefits everyone, not just a select few.

This is the future I’ve envisioned and championed throughout my work, and I remain committed to seeing it realised.

Originally posted at https://independentaustralia.net/business/business-display/smart-grids-a-path-to-neighbourhood-energy-independence,19222

Paul Budde is an Independent Australia columnist and managing director of Paul Budde Consulting, an independent telecommunications research and consultancy organisation. You can follow Paul on Twitter @PaulBudde.