A quiet revolution is happening on the rooftops of Australian homes that could cause major problems for the electricity market.
Within three decades, up to two-fifths of Australia's electricity could be generated "behind the meter", from household solar and even wind installations, predicts Transgrid, the major electricity transmission operator in NSW and the ACT.
But regulators and policy makers are nowhere near even starting to think about how to deal with that kind of change, Transgrid executive Gustavo Boldini says.
Generation these days is still relatively simple; in the main, "big, bulky power stations" produce energy that goes to the consumer.
"If the future, you may have a whole suburb or district that has got just as much energy being produced as one of those bulky power stations," Mr Boldini told AAP at an emissions reduction conference in Melbourne.
"The question then becomes one of how do we treat that - as another power station in itself or do we treat it as still individual mum and dad power consumers?"
The Australian Energy Market Operator wants the Finkel review of electricity security to recognise the issues that arise from increasingly distributed energy resources, like household systems.
Its market development specialist Ben Skinner told the Carbon Market Institute's conference a problem AEMO had already identified was the lack of real-time information about demand and supply resources.
He said there had nearly been a second state-wide blackout in South Australia in March in part because the response to a voltage dip after part of the transmission network blew up was completely different to anything experienced before.
AEMO believes that's partly due to the nature of new inverters used on rooftop solar systems.
Both Mr Skinner and Mr Boldini would like to see more flexibility in the rules governing the electricity market to allow new technology to be tested and regulatory adjustments made as needed.
"If you've got new technology around the corner, let's not get caught by surprise next time," Mr Skinner said.
"Let's actually get some examples of it even before it's economic and actually test it out, see how it works, what are the rule constraints but also what are the system security challenges that it might present."
The risk-averse regulatory environment prevented companies like Transgrid from taking punts on things that might actually result in a better market outcome, such as ways to integrate battery storage, Mr Boldini said.
"We're trying to catch up on a market moving faster than what we have really expected," he said.