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How the networks fiddle with data to trash rooftop solar PV

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Networks across Australia appear to be launching a major campaign to curb the growth of rooftop solar PV – introducing or proposing tariff changes such as high fixed network costs or “demand charges” that penalise rooftop solar and are designed to slow installation rates.

As part of this campaign, the networks are using data that they say “proves” that rooftop solar PV is not reducing peak demand, and therefore not contributing to the grid. They use this to justify changing tariffs to reflect the “cost” of rooftop solar, but not its benefits.

South Australia Power Networks did this while arguing the case for “demand tariffs”, an initiative that it admits will halve the rate of solar installations over the next five years, and penalise solar households with added costs.

But the data has been challenged by the energy energy researchers at UNSW’s Centre for Energy and Environmental Markets and School of PV and Renewable Energy Engineering, who argue that SAPN has not been forthcoming with the whole picture about the contribution of rooftop solar PV.

In its submission, SAPN uses the example of a stinking hot day, January 16, 2014, in the middle of a major heat wave, to show that rooftop solar PV did not contribute much at the peak.

“Peak demands typically occur on very hot days from the late afternoon into the mid evening and generally when solar PV generation has fallen off,” SAPN said.

“The advent of greater amounts of distributed solar PV generation has tended to lower energy demand from the grid during the late morning and afternoon, but has little to no impact on State-wide demand peaks, other than delaying them to a little later in the evening.”

And it published this graph below to further its case, ostensibly showing that rooftop solar PV’s contribution had disappeared by the time that the peak – bolstered by the heavy use of air conditioning – emerged around 8pm local time.

sa solar peak SAPN

But here’s the thing. You will note that the SAPN graph includes only “exports” from the more than 400MW of  solar that was then on the rooftops of the state’s houses and businesses. (There is now more than 500MW).

But what happens when the total output from rooftop solar is included?

This graph below – provided UNSW team, using data from the Australian PV Institute – paints a completely different picture: It shows that rooftop solar PV did in fact reduce the peak by a considerable margin on that day.

sa solar peak unsw

It could be assumed that the solar households were consuming a lot of their output at that time because they, too, would have had the air-con on, because as the graph shows it was still 40°C outside.

(It should also be noted that SAPN used just residential demand, while the UNSW graph included overall demand, the key measure of network usage).

Iain MacGill , the joint director for CEEM, says UNSW researchers have concerns that such reports as the SAPN discussion paper is using selected data that is not generally publicly available, and hence subject to independent review.

“Their (SAPN’s) plot of solar PV’s contribution is potentially misleading because it shows estimated PV exports rather than PV’s contribution (self consumption as well as exports),” MacGill says.

“Whilst this may reflect the realities of net metering of PV, it does mean that the role of household PV in reducing overall residential demand is not made clear, because exports will naturally fall away as PV falls while household demand increases.

“Also, residential solar PV doesn’t only play a role in reducing residential demand, but assists in managing State wide peaks as well.

“It seems pretty clear that PV in SA actually provided a very useful reduction in peak demand of over 100MW whilst also delaying the peak for a couple of hours.”

Indeed, this is the very conclusion that SAPN came to itself in a presentation to analysts last year – using data from the very same day – January 16, 2014.

SA-demand-Jan-16-Spark2-590x308

It published this graph above to show how rooftop solar had not just shifted the peak from the mid to late afternoon, but also lowered it considerably in comparison to the previous heat wave in 2009.  “PV is shifting (the) peak, but also helping reduce stress on the network during heat-waves,” it said in its presentation.

The problem with SAPN’s proposed demand tariffs is that rooftop solar is not credited with any network benefit.

If the timing of an individual household’s maximum consumption happens to outside of this peak demand, such as late afternoon, it means they could still face massive “demand charges” even though it correlates to one of the lowest demand periods for the networks.

The efforts to install “demand tariffs” are part of a broader process of introducing more “cost reflective” tariffs.

But what seems to be happening, however, is that the largest cross subsidies – between city and remote rural households, and for air conditioning – aren’t being touched.



Instead solar PV seems to be a major point of focus – perhaps not surprising since that takes revenue away, but very problematic for clean energy transformation and genuine equity between customers.

By speading the time, number of days and months as widely as possible, the networks are giving themselves a pretty good chance of picking up a particular period of high demand in a house for whatever reason.

The solar industry says that is unfair. Some say it could result in solar rooftop arrays increasing bills rather than leading to a fall. Encouraging battery storage is a good idea, but many households can not afford storage now, yet they risk being penalised for using high amounts of electricity in off-peak periods, when their rooftop solar is actually helping reduce peak demand.

Steve Blume, from the Australian Solar Council, says rather than simply emphasising the costs and reinforcing their already highly negative public attitude towards rooftop solar, the networks should be focusing more on selling their value.
“The networks need to be working out how that value is maintained and expanded and therefore how consumer charges can equitably be set on a ‘value reflective’ basis – and allow their businesses to survive in a multi-flow distributed, and clean, electricity system,” Blume says.
Anna Bruce, a colleague of MacGill’s at UNSW, agrees: “We believe that the network businesses should be required to publicly provide all relevant data when releasing consultation papers regarding proposed tariff arrangements, and that great care is required when making claims about the role that PV plays or doesn’t play in terms of peak demand, given its implications for tariff design.”
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  • suthnsun

    There’s a big difference in overworking a transformer for an hour compared to 4 hours. The benefit of PV flows through unheralded at every level.

  • Pedro

    At least the Networks are past the 1st stage, denial, of the grieving process only 4 more to go.

    • Mark Roest

      Right — they’re in the anger stage.

    • Ian

      Very nicely said, Kubler-Ross would be proud of you! Death by a thousand cuts!

      what I would like to know is what would be the actual tariff structure proposed? Is there a fixed connection fee and a demand fee, and how is peak demand calculated ?

      Renewables need diversity of electricity generation and storage. ie, solar :PV, thermal; wind; hydro; pumped hydro; batteries. Battery storage is the weak link up to this point. Distributed battery storage needs all the encouragement it can get. Peak demand charges will be just the ticket to achieve this.

      The circuit pieces needed would be a demand limiting device, a load management system- which could be as simple as a timer switch on large loads like hot water heaters- an invertor, batteries and a battery charger. Until more definitive types of cheap large storage capacity lithium or flow batteries come to market, small storage capacity lead acid batteries could be used. These only need to cover the very short evening peak and can be trickle charged from the network for the rest of the night and during the solar hours of the day. In effect the network will be used as a trickle charger and the household would manage its peaks and troughs of demand. A 1.5 KWH deep cycle battery costs in the order of $400 and with a bit of DOD abuse will probably last the few years until Tesla and the like get their mass produced acts together. A small load and demand management system would not even need rooftop solar to provide financial benefits in the demand tariff scenario. The electronic parts of the system could be either very simple and cheap to just cover an interim deep cycle lead acid battery system or definitive and future proofed to be ” Powerwall ready” or ” lithium ready”. This could be a nice undergraduate electrical engineering project.

      One thing is sure though, and that is network customers will adapt to any tariff structure thrown at them. If the demand tariff is designed to slow down or discourage distributed solar uptake it could well badly backfire on the network providers.

      • http://www.cruisingunderpower.fastmail.net Sue (Russell Island, Qld)

        I already have a system like this that I put in 18 mths ago. Runs all my house circuits except the electric stove/oven. 2kw solar system, 3.5kw inverter, 4 x deep cycle lead acid batteries, all efficient appliances etc. Runs on solar except when bouts of rainy weather etc and uses the grid for backup. The aim is to go offgrid when storage is better and cheaper.

      • Pedro

        Thoughtful post.

        I am no expert on tariff structures. One thing I am sure of is that if you want it to be fair and cost reflective you can’t have the monopoly gentailers setting the rates in cahoots with a pro FF government. I am personally in favour with a real time TOU tariff structure provided the end user has options to quickly reduce their power consumption.

        The exciting thing about the energy disruption event heading our way is that we have 4-5 technologies converging at once. Decreasing RE costs, decreasing storage costs, the start of a mass market from small to large power conversion units (hybrid inverters) and big data. There are some pretty clever people working on making this all work together seamlessly. In Australia I think that it will largely be the domestic scale customer that creates the demand and drives down costs. The utilities are generally trying to stop or slow down this transition. They are only delaying the inevitable, simply because whenever a regulatory barrier has been thrown up by government or utility the RE industry has typically found ways around it.

        I for one plan to install a hybrid system when my generous FIT expires and use the grid as a back up. If my utility decides to increase my fixed charges to an unacceptable level I will disconnect and if I need the grid I will pay my neighbour to throw an extension cord over the fence.

        The faster the utilities get to stage 5, acceptance the better off they will going forward.

  • David Leitch

    I agree with the general thrust of this argument but you can’t include gross solar production and self consumption, its either net production + self consumption or gross production from PV.

  • BsrKr11

    completely expected and anticipated..if anyone didn’t see this coming you simply have to follow the money to understand the nature of the conflict between centralized systems and distributive ones…

  • Phil

    Divest these people and make them redundant by going 100% off grid. I did and it makes all this power network greed totally meaningless. And the off grid equipment suppliers are growing their business so it’s creating a whole new industry and still paying taxes of course . That seems to be a far more ethical outcome to me than what the power and network providers are offering.

  • Mark Roest

    Giles, your analysis is spot on! Perhaps the Edison Electric Institute sent out this play-book globally, after they announced the threat of the death spiral to their members. It is certainly a consistent pattern in the US, Spain, and other nations as well as Australia. Here in California the argument is embedded in the Net Metering Replacement Tariff process, as well as requests to impose fees, and a play by PG&E to grab all the available funding for EV charging stations in its territory, be first to market using ratepayer funds, and charge ever 3 times the average price for charging stations — and 3 times what San Diego G&E and the Los Angeles utility charge in their responses to the request for proposals. In other words PG&E is attempting to do exactly what the Australian utilities did — gold-plate (diamond-plate?) the rate-base so they can gouge their customers — and take all the oxygen from their competitors. On the other side, they’re all trying to defeat the challenger for the dominant position in the energy market, and since they cannot do it fair go, let alone fair dinkum, they will do it any way they can.

  • MaxG

    The people will loose. This is a war of the corporations in bed with the government (selling the public assets), against the people. Who do you think will win?!

  • onesecond

    The lies of the network is good for humanity. As is coal. Look at this light and repeat after me: The lies of the network is good for humanity. Coal is good. PV is bad. Coal is good. PV is bad.Coal is good. PV is bad.Coal is good. PV is bad.Coal is good. PV is bad.Coal is good. PV is bad.Coal is good. PV is bad. The lies of the network is good for humanity.Your compliance will be rewarded.Your compliance will be rewarded.Your compliance will be rewarded.

    • Pedro

      You are good at the 3 word slogans definitely spin doctor material. I like slogans to rhyme. Coal is the Goal. PV will never be. 😉

    • Rockne O’Bannon

      networks are extremely efficient. That is not even theory. Just about every network humans have made shows the steadily declining costs and increased benefits of network size. Highways, rail, the internet, etc.

      The extremely low cost and high stability of electrical grids will be sorely missed if it is ever compromised. I am very happy to be living in a time when I can just flip a switch and have whatever I want. A lot of people are willing to pay a high price for that.

      I am glad that there is controversy and argument related to coal. I am not so sure that there is an easy cheap way to get from coal today to PV tomorrow. Maybe simple slogans are not that helpful for such a complicated social decision.

      • Diego Matter

        “The extremely low cost and high stability of electrical grids will be sorely missed if it is ever compromised.”

        I’m not sure about that, because network costs make up over 50% of my electricity bill in SEQ.

        Rural areas in Qld could install solar PV and storage for a cheaper price than the network is charging, and all customers have to pay $600+ per year to keep that network in these areas.

        And network costs will be an even bigger chunk of my bill because networks continue to invest heavily in the next five year period (see article in RE – $50bn in the next period over Australia).

        I would argue the networks are charging an extremely high price for their service. If you don`t think so one has to check the latest PV and storage prices. They are not what they used to be!

  • Math Geurts

    Stop worrying about the fate of the network. Go off grid if you believe that makes you happy. Pay if you want to stay.

  • Rockne O’Bannon

    “It could be assumed that the solar households were consuming a lot of their output at that time because they, too, would have had the air-con on, because as the graph shows it was still 40°C outside.”

    This is CERTAINLY true. Everyone take note. One of the very least researched and reported streams of data worldwide is the amount of power generated AND used on site. Few rooftop systems will record those data, they are not applicable to utility scale installations, and they are not taxed or compensated in any way. Actually, some people prefer it that way.

    I have seen studies that have tried to estimate it, but they do so as “reduced demand,” which also gives an underestimation.

    Anyway, this is really spurious stuff from utilities. Think about it: if people have 4 kW peak demand and put 12 kW on top of their home, utilities will scream bloody murder that the home owners are just trying to profit off of everyone else. But if a homeowner puts on 4 kW, the utility will turn around and claim that there is no benefit.

    They can’t be allowed to have it both ways.

    • ldc

      I don’t see an issue with the SAPN graph not showing self consumed PV.
      Think about it, from the top down regardless of whether the PV is self consumed or exported the usage is what it is, and this is used to justify a network upgrade.
      The tangible benefit of self consumed PV during peak times is captured through deferred/no network capacity expenditure and lower tariffs.

  • James Hilden-Minton

    The basic problem here is that the network is saying that only the export of rooftop solar has value to the network and not self-consumption. This is duplicitous considering that network rate plan induce solar owners to give priority to self-consumption over exports. This happens whenever the FiT is less than the retail rate. If a network really wanted more exports at times of peak demand, then they should devise a time varying FiT scheme the is an increasing function of demand. Such as scheme would reward exports over self-consumption whenever the network has sufficient need for it. Moreover, it would motivate ratepayers to invest in batteries and flixible demand technologies to facilitate more net exports at times of need.

    In figure 2, there is a clear difference in the amount of self-consumption versus export between the date in Jan and Feb. The value of self-consumption is quite different in the two days but the FiT for exports is the same. Thus, the ratio of export to self-consumption is higher in Feb than Jan. This is precisely what a fixed FiT motivates. So the network really needs to own up to their role in setting up FiT schemes that fail to properly compensate exports when the network needs them most. The network is getting exactly what it is paying for. Suppressing rooftop solar will only make matters worse by reducing net exports when they are most needed. I suspect such networks are self-defeating and fail to recognize it.

  • James Hilden-Minton

    If only there was a way to get solar owners to export more when the network needs it and self-consume when the the network doesn’t need it? Oh, yes, networks could just pay a higher FiT when demand is higher.

    Demand charges are the wrong instrument. They will motivate adaptations to minimize utilization of a grid connection, but they do nothing to trigger more net exports when the demand and spot prices are the highest.

    What is the logic of paying only 10 c/kWh on net exports, while buying power at 50 c/kWh on the spot market and selling at 25 c/kWh residential retail? In such an upsidedown situation. If the FiT were bumped up to 50 c/kWh in just such moments, then it would accomplish too things: it would minimize consumption in solar home avoid a 25 c/kWh loss, and it would increase exports in solar homes to help drive down spot prices. Both actions would minimize losses to the utility. Moreover, this would minimize the required amount of investment in peak capacity to save all ratepayers money and to reduce the risk of stranded assets to investors when grid defection commences in earnest.

    By contrast demand charges incent ratepayers to become more fully self-consuming and self-sufficient. So the network is willing to take a bigger loss in peak demand situations and raise the stakes in grid defection just to suppress self-generation. My guess is that these are not the brightest bulbs in the barn.

    • hydrophilia

      Your argument for more granular FiTs is a good argument for charging/paying everyone based on the spot price. Theoretically, this could lead to some really nice ways of shifting consumption, either through smart storage or smart appliances, dropping peak demand on the grid far more cheaply and effectively than the old dumb methods.

    • Rockne O’Bannon

      I dont know why your comment does not have more upvotes. This is exactly true. It is the perfect justification for a reasonable FIT.

      At the margin, there are always going to be winners and losers. People have this idea that if they only had a battery, they could game the system enough to come out more on the winning side, and utilities would pay for the party. That is nonsense. Conversely, people have this notion that the evil utility is out to skin people alive for every last penny, rather than just having a healthy company/client relationship.

      Here is the deal: If you have a really high FIT, you encourage people to put as much rooftop PV on their property as they possibly can. That is clearly perverse. If there is no FIT or net metering, people will rationally put up the smallest system possible just to meet their needs in a marginal cost/ marginal benefit kind of solution.

      A rational FIT will be sufficient to reward people for making efficient systems, or maybe just a little larger. It will give them incentives to limit their consumption at ALL times, and presumably they will have some juice left over for their neighbors during summer for air conditioning. Maybe the utility has to pay a little more during most of the year, but the solar can really help hold down the peaks, and thereby costs.

      I think there is way too much conflict between solar owners and utilities. If policy and incentives are done correctly, there is a huge pool of private capital willing to invest in new capacity. Why is that a bad thing?

  • Colin Nicholson

    Does this mean that the networks would be satisfied if we all moved the solar peak to 8PM through storage

  • AlexSmith77

    The same in North America. Large energy companies are colluding with captured agencies, like Public Utility Commissions, to make it as hard as possible for solar. They may pass prohibitive state laws, or levy and extra fee on solar producers. I’ll have that in my show in a couple of weeks.

  • Neil Frost

    We all should band together for one day in mid summer and turn our solar off. That would show them what out rooftop solar does. Wide spread blackouts.

    • Calamity_Jean

      I like this idea. Do it for an hour all over the country once a week for two months. The utilities would be on their knees.

    • Evo

      in SA, solar makes up about 500MW of power out of a peak of 3500MW (about 15%), so either they would have to ramp up 500MW from somewhere else or drop 500MW from the grid. Not what I would call widespread.

      Don’t get me wrong, I love solar and every bit helps but 15% isn’t much.