Updated June 12, 2017 17:56:43

Photo: Summer's coming, and the Australian Energy Market Operator is getting ready. (ABC Open: Brendan Mounter)

The Australian Energy Market Operator (AEMO) is sounding out the nation's most energy intensive businesses about a plan for them to switch off during extreme heatwaves this summer.

The operator is trying to entice big businesses to switch off and shut down in exchange for cash, in a move that is designed to put the brakes on demand and bolster Victorian and South Australian energy reserves.

"Part of AEMO's responsibility is to plan to secure electricity supply," AEMO spokesman Joe Adamo said.

"That includes during extreme conditions and over the summer period, however rare conditions may be.

"So it's not an unusual step but it's a more proactive and prudent approach because what we've seen ... is that the electricity system has changed.

"I think it's more prudent for us to do things a little bit differently than what we've done in the past."

So how does it work?

Australia has an open energy market, meaning generators can make bids to supply power during certain times of the day.

If there is demand for their power, it will be purchased.

Tennant Reed is from the Australian Industry Group, which backs AEMO's plan.

"We're used to thinking of the energy system as being mostly about the generators," Mr Reed said.

"There's a certain amount of demand and when there's more demand, more generators need to turn on, but demand itself can be flexible.

"There is enormous potential to cut costs, not just of peak power, but of the constraints on our networks by making demand more flexible, giving users of all sizes a reason to use energy differently when there are extreme conditions."

Mr Reed is confident Australia's biggest energy users will be open to the plan.

"In Western Australia … they've had a system in place for many years that encourages that and there's no reason to think that the same potential or more doesn't exist in the east," he said.

'This is the market operator doing their job'

Victoria's Energy Minister Lily D'Ambrosio stressed AEMO's move was not an indication that the state's energy supply was at risk.

"This is the market operator doing their job, planning ahead for all eventualities and of course this is about ensuring that they have more than sufficient supply available in the event of extreme weather events," she said.

The minister said she was confident Victorian families would be able to access the energy grid when the weather heats up.

"The market operator have made it very clear that they anticipate that Victoria will be fine for this coming summer," she said.

Topics: electricity-energy-and-utilities, australia, vic, sa

First posted June 12, 2017 17:53:25