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Rooftop solar could power all households, slash electricity prices

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What would happen if every Australian household installed solar PV on their rooftops? That’s the hypothetical question a new study has set out to answer, with the main aim of proving a solar point (while rattling a few cages along the way): that solar power is a viable solution to Australia’s energy challenges and has the potential to dramatically change the nation’s energy landscape.

The study, conducted by solar provider Energy Matters using government data, found that if every suitable rooftop in Australia was turned into a solar power station, the amount of energy generated would supply more than 134.8 per cent of the country’s residential electricity needs, and would drive down power prices from an average of 30c per kilowatt-hour to 7c/kWh.

According to Energy Matters, there is just under 400 square kilometres of available roof space on residential roof tops in Australia that could accommodate solar panels – equal to the size of inner Melbourne. By the company’s calculations, each one of the suitable houses could theoretically hold an 8kW, 32-panel solar power system. The cost for each system at the current market rate would be less than $14,000.

These houses would then generate 36kWh per day; and with the average household currently consuming 18kWh per day, the excess electricity would earn the household between $2100 and $3,200 per year. This way, the study estimates each household’s solar system would be paid off in between four and six years.

And then there is what Energy Matters describes as the “knock on effect” to factor in, with energy prices and CO2 emissions reduced dramatically, and a huge boon in green jobs.

As for the cost of the installation, the study finds this would represent 8 per cent of Australia’s yearly GDP, or 0.4 per cent per year when amortised over 20 years. This compares to the $15 billion Australia currently spends on electricity each year, which amounts to 1 per cent of it GDP.

What would happen to Australia’s current electricity production facilities under this scenario? “There would be almost no need for base load power stations on a sunny day,” said Brass. “Australia could close down most of its coal-driven power stations overnight, except for those in heavy industrial areas. Under-utilised gas fired peaking plants, which are already in existence, would be called upon to generate Australia’s night time and cloudy day electricity needs. Shutting down Australia’s coal power stations alone would mean our emissions targets would be met almost immediately.”

It all sounds pretty sensational, but according to Energy Matters, who released the results of the study today, the figures it has turned up are “extremely conservative” (the company’s calculations show solar can supply 134 per cent of Australia’s residential needs, but it says the actual figure would be much higher), and its hypothetical scenario of a rooftop solar-powered Australia “could easily become a reality.”

“Our vision is not too dissimilar to Bill Gates’, who predicted every household would have a computer,” says Energy Matters’ Nick Brass. “People at first scoffed at this vision, but the advent of the affordable personal computer changed the world. Energy Matters’ grand plan is to help convert every suitable rooftop in Australia into a solar power station.”

“The idea is for the eligible houses to produce more electricity than they need with the excess supply fed back into the grid in order to power Australia’s residential and non-residential needs,” said Brass. “Further calculations we performed indicate the amount of electricity generated would supply 38.8% of Australia’s total electricity requirements (inclusive of all residential, industry, commercial services, metal production and mining).”

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  • Warwick

    There’s a pretty big hole in the maths…if power prices are driven down to 7c/kWh as is claimed and each rooftop is exporting 18kWh/day, you will earn $460/year yet supposedly the excess electricity is worth $2,100 to $3,200 per year…an implied rate of as much as 48c/kWh.
    So if everyone is paying 7c and earning 48c on half their production just where on earth is the money coming from?

    • http://www.coomadoug.com coomadoug

      The maths are good mate. The cost of energy from the grid will be increasing inversely proportional to the demand from it. This is because of the infrustructure costing. The power from the grid might be 50 cents a KWH but what we produce and use with solar will effectively cost us much less.

  • Andrew Thaler, Cooma

    With regards to output, and the idea of gas peaking plants, the entire residential generating system wouldn’t be covered by clouds all at the same time. So, some consideration of cross supply from sunny areas to cloudy areas…. and can/could our electricity system cope with this?
    Probably not!
    It is a bit of a pointless scenario, as there are still other energy sources supplying- riparian hydro, wind, wave, bio etc. It’s a great attention seeking headline- but not entirely practical unless there is a wider consideration of the whole supply system.
    It might have been More appropriate to claim that this research shows we could move away from coal fired baseload generation. And there is a whole shit load of more appropriate commercial and industrial roofs that I’d rather see covered in Solar panels.

  • Mick

    ???

    Agreed Warwick – this makes no sense what so ever.

    Export revenue aside – the 7 c/kWh seems ridiculous. Presumably if you are exporting that much electricity, then you need still need a grid.

    Unless of course they are assuming a variable rate of 7 cents per kWh alongside a $750-$1000 p.a. capacity charge – I highly doubt this is the case.

    Would love to see the study.

    • Warwick

      Me too, I’m most intrigued. If you take their numbers of 400sq km of roof space and looking up the size of a standard 32 panel, 8kW system is an area of 54m^2 or 7.4m homes, which is pretty close to the ABS number of 7.6m households in Australia. I wonder if they’ve really investigated the suitability of dwellings’ roof area or just assumed all homes.

      On that basis alone of 7.4m homes each being paid between $2100 and $3200, that’s an annual bill of between $15.5bn and $23.7bn. (As a comparison, the revenue of Ausgrid, one of the largest network businesses in Australia was only $2.9bn last financial year).

      I think the black hole in these figures would make both major parties blush…

      • Mick

        Not to mention that the turnover in the entire NEM last year was ~$6 billion, according to AER…

        (Admittedly, that is probably only the spot market)

    • http://www.coomadoug.com coomadoug

      This is not rediculous but I understand how you might consider it so.

      The energy that goes onto the grid will be 40 or 50 cents a KWH in this time of vast solar and other renewable energy sources. The loading of the grid will be reducing but the cost of the infrustructure, the politics and the way the costing process goes will require the energy provided from this grid to be at these high levels.

      Not so for me though. i will have an 8 KWH system on my roof like these houses they use in the example. When you look at the initial cost and the replacement factors, the storage system i select and so on, the cost of my enegy in my house will effectively be 7cents a KWH. If i run short of energy i will take it from the grid perhaps. But if i do it will cost me and arm and a leg.

      But it will be nice if they buy some from me at double my costings.Perhaps tripple.

  • colin

    More things wrong in the maths. There is less than 100 square kilometres of suitable domestic roof space in Australia. That is still 50% of 10,000,000 houses/dwellings of 20 squares (new houses are running at 25 squares average, so the overall average must be close to 20). Total buildings in Australia might double that to 200 square kilometres. 10,000,000 dwellings might average 4KW installations for 5MwHrs/annum which gives us 50 TwHr. 400 square kilometres split between 10,000,000 dwellings is a macmansion for all.

    • Warwick

      Found a few more…they want to invest 8% of GDP…that is about $112bn as 8% of 1.4 trillion….which is around 7.6m @ ~$15,000/unit….so yes, every household. So for $112bn, you could alternatively get 1 NBN ($43bn), a VFT ($61bn-low cost), a Joint Strike Fighter program ($12.5bn) and maybe a $1b Sea Sprite program too and perhaps a Myki card system ($1.5bn).

      • plumplum

        Unit price for about 5kW is now around $10,000.

  • Steve

    Colin, could you clarify your term ‘squares’? I presume you mean square metres, in which case house roof areas would be more like 250 square metres, not 25-20 square metres as you state?

  • http://www.coomadoug.com coomadoug

    Lets not nit pick here too much and be negative. It seems the ecconomics are right to eliminate carbon dioxide destruction of the planet as we know it.If it’s not we are in for one hell of a nightmare.

    Coal and oil are solar energy also and its just the wrong variety to use. I work for a mob who generate 5000 GWatt Hrs a year of what is essentially solar energy, its the water the sun puts in our dams.

    The load on the grid is going to reduce because of solar panels and the use of various storage systems. As a result, the price of electricity from the grid is going to increase further accelerating the incentives to disconnect.They will extract the same money from us what ever the supply quantity might be in a year.

    The grid will be a standby supply for me in the next decade. However within 30 years, i will be an old guy but I wont need the power grid. i will plug my hydrogen car into the house should the independant system I have installed fail me. Actually the car will plug herself into my house when i need.

    The car will drive me down town via voice command. It will go and park and come and get me when I whistle it like a dog in my phone.It will drop me at the front door and park itself in the garage and may run the power of the house if need be.

    We already have cars with a range of 400 miles, refuel with hydrogen in 4 min, the fuel cell stack down to 100 kg and the cost reducing. The life time of the stack now approaching 200oooKm…Lets see what Toyota bring out in 2015. Lets look at the new fuel cells being installed in homes this year in Japan,Europe and USA. I think by 2025 the wires and poles in the street are going to look like horse dung in London in 1920.

  • http://www.energymatters.com.au Nick@EM

    Hi all,

    Thanks for the commentary on the article published in reneweconomy.

    Please see full text on the Energy Matters website
    http://www.energymatters.com.au/index.php?main_page=news_article&article_id=3660

    Note:
    – 30% of available residential roof space is the assumed requirement
    – This will power 130%+ of residential energy needs
    – We still need the grid
    – The cost of solar equates to production over 20 years divided by current system pricing

    The guts of the matter is, this is a realistic scenario and it will create massive disruption to traditional energy market dynamics.

    Have a sunny day ;-)

  • Warwick

    Checked the “Energy (Maths)ers” website which highlights that calculations do not include STC cost in installation cost. The website claims 277,558,883kWh/day of PV, which is equivalent 101,308,992MWh/pa…assuming 15 years of deeming and taking the current STC price ($36) we have an additional $54.7bn in upfront costs to pay for the STC’s created. So according to their logic we have:

    (1) Spend $111bn today on installing additional PV
    (2) Slug consumers $54.7bn in STC’s (small scale RECs)
    (3) Pay all households ($2100-$3200):$15-24bn/pa total
    (4) Keep the grid
    (5) Drop household prices from ~30c/kWh to 7c/kWh

    So if the total upfront cost is roughly 12% of GDP and the cost of paying rooftop owners annually is in the same ballpark as the total energy and network bill in Australia each year, whilst keeping the grid….how does it become cheaper???

    If this is a realistic scenario, it’s time to charge up the flux capacitor, call the Doc and see the DeLorean hit 88MPH…