PDRS (Peak Demand Reduction Scheme)

Written and checked by the Energy Merchants desk · Reviewed 2 October 2026

PDRS stands for Peak Demand Reduction Scheme. It is a New South Wales scheme that sits beside the Energy Savings Scheme and is built on the same legislative framework. The PDRS creates PRCs (Peak Reduction Certificates) and obliges electricity retailers to acquire them.

Its purpose is to flatten the evening peak, when demand is highest and the grid is most expensive to run. That is why batteries, smart controls and efficient cooling feature in it.

In practice

Most NSW installers meet the PDRS through batteries. After the NSW battery incentive moved into the federal Cheaper Home Batteries Program in 2025, NSW kept a PDRS incentive for connecting a battery to a virtual power plant. A customer can therefore get the federal STC discount and a PDRS-linked incentive when the battery joins an approved VPP.

On the job, this adds a decision at the quote stage: which VPP provider, and does the battery’s inverter and communications meet the provider’s requirements? Our Cheaper Home Batteries Program installer guide explains the federal side. For the PDRS side, check the scheme’s official page, because activity rules and values have changed.

Common confusion

PDRS is often shortened to “the NSW battery rebate”, which blurs two things. The main battery discount is federal. The PDRS component is the VPP connection incentive.

PDRS and ESS are sibling schemes. ESS creates ESCs for energy saved. PDRS creates PRCs for peak demand cut. See ESS definition.

Look up other terms in the certificate trading glossary, or see battery STCs for the federal claim.