CEFC says major interconnector upgrades needed, as renewables replace coal

Woolnorth wind farm, Tasmania

Australia’s inter-regional transmission lines would require significant upgrades, including a second interconnector between Victoria and Tasmania, to keep up with the transformation of the electricity sector from fossil fuels to distributed renewables, a new report has found.

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The report, prepared by Jacobs for the Clean Energy Finance Corporation, found that large amounts of interconnection were required over the study period, with up to 3,500MW of additional
interregional capacity – the vast majority of it distributed renewables – expected to be added over the whole NEM by 2030.

“Given the range of emission reductions required and the immediate closure of coal fired plant explored under most scenarios, interregional transmission upgrades were required to allow exploitation of the available renewable resources (as well as gas-fired resources) to replace the coal fleet,” the report said.

In policies targeting renewables as the main source of emission abatement, the CEFC report found that interconnect upgrades would be necessary for “least cost development of the renewable energy, either by allowing access to lower cost resources or by facilitating more efficient levels of dispatch of those resources.”

It also noted that the faster the rate of closure of Australia’s remaining coal capacity, the sooner the interconnect upgrades would be needed. A new second link between Victoria and Tasmania, for example, would be required by 2025 under “most emission targets examined,” the report said.

The report identified some factors that could limit and/or slow the need for interconnector upgrades, including falls in electricity demand, and competition from battery storage.

“With large scale adoption of storage, surplus energy within a region could be stored for later use rather than being exported to other regions,” the report said.

But it noted that in the case of Tasmania, with its large hydro resource, a new Bass Strait interconnector “could enhance the usage of this notional storage capacity.”

“Of particular advantage for Tasmania,” the report continued, “is that it provides the opportunity for inter-seasonal storage of surplus solar energy which is abundant in the summer time and much
reduced in the southern states in winter.

Woolnorth wind farm, Tasmania
Woolnorth wind farm, Tasmania

“Tasmania could receive surplus solar energy in autumn and summer from the mainland and conserve its hydro yield for export in winter and spring.”

The findings follow the revelation that an investigation into the outage of the existing Basslink interconnector between Tasmania and the mainland returned a verdict of “cause unknown.”

The independent investigation, completed by UK-based Cable Consulting International (CCI), supported Basslink’s position that the fault, which took the under-sea cable out of action for six months, was a “force majeure” event.

The event was used in some quarters to boost the campaign for a second interconnector across the Bass Strait, a project the CEFC has indicated it would back.

In line with the Jacobs report, however, an earlier state government report suggested a new Basslink cable would not be worth the $1 billion investment unless at least 1,000MW of new renewable energy capacity was built in Tasmania.

“A co-ordinated development plan would be needed to optimise the utilisation of the existing hydro system within the current capacity of Basslink, the subsequent development of a new Bass Strait interconnection, and then the further development of hydro-electric and wind resources in Tasmania to maximise the value of these assets,” the CEFC Jacobs report says.

“Some commentators have argued that the role of major transmission systems could diminish in the future with the development of embedded generation and micro-grid,” the report said.

But it added that it was likely “a grid based system with transmission interlinks” would be required even if the cost of battery storage fell rapidly, “as such devices are not currently suited to energy storage over a yearly cycle.”

Comments

5 responses to “CEFC says major interconnector upgrades needed, as renewables replace coal”

  1. trackdaze Avatar
    trackdaze

    I think its clear from the outages of the interconectors that any upgrades ought to be in the form of redundant lines and resiliency.

  2. Peter F Avatar
    Peter F

    I think that this is a hangover from the centralised power models of the past.

    A key difference between Australia and other markets such as China, the US and Europe is that good renewable resources are located close to the main load centres. For example according to NREL research in the US about 15% of the roof space covered with solar would supply the total peak demand. NSW needs about 2,000 3.5MW wind turbines which can all be located within 150 km of the load centres. With new low wind designs load factors over 40% can be achieved almost anywhere in NSW. Power to heat (or ice) demand response and grid and private batteries and some more pumped hydro can easily cover the gaps
    Tasmania could install 400MW of wind/ solar and completely cover its
    drought caused restrictions for less than the cost of a new
    interconnector.
    Similarly SA needs to install 400-600MW of despatchable renewables/storage to stabilise its power supply. This will be easily achieved with the surging interest in batteries and possibly one or two 50-100MW turkey nest pumped storage systems as well as 3 or 4 CST plants. Again the cost and time to build will be less than the cost of a new interconnect to the NSW coal plants.
    The Qld/NSW and NSW Victoria interconnects may need some strengthening but a sum of about $1b would probably cover it. the rest of the $3,5b would be far better spent on energy efficiency and local distributed generation and storage resources

    1. Jonathan Prendergast Avatar
      Jonathan Prendergast

      Thanks for writing this. Exactly what I wanted to write.

  3. Rod Avatar
    Rod

    A billion tax payer dollars (I assume) on an interconnector to provide peak shaving to the national grid, energy security, back up in case the other one fails again or a billion tax payer dollars on a rail line to a big black hole. Decisions, decisions.

  4. Ian Avatar
    Ian

    Tasmania’s hydro is once-through hydro current capacity is about 2600MW and its yield is set at 8700GWH a year, the bass-link is 500MW either way . A large percentage of the electricity consumption is industrial ,namely aluminium,manganese and zinc smelting paper and cement manufacture. The total demand is about 9700GWH a year.

    If the hydro resource was run to capacity 24/365, this would produce 22 770GWH, but there is only enough water for 8700GWH. Wind and solar can be installed to virtually any amount and together could extend the water storage to possibly produce 20 000GWH continuously, subtract a demand of 10 000GWH and you get 10 000GWH available for continuous export. This could supply a bass link cable of 1.1 MW continuously. Wind would have a capacity factor of 40% , so this system could support about 4GW of wind. The cost to install 4GW of wind would be about 10 Billion dollars, the 1GW bass link 1 billion. Wind farms at present can produce power at 80$/MWH (recent Coonooer bridge project). Therefore that approximate cost to export power at a continuous rate to Victoria from Tasmania allowing for the complete and reliable local supply to Tasmania’s businesses, would be 9c/KWH, day and night, summer and winter, drought or plenty. Reflect Tesla and weep , nothing could beat this amazing resource. My figures and assumptions may be a little out but the gist remains the same. Without touching the current hydro resource and without considering solar a small investment of 10 billion dollars could supply Victoria with at least 1GW power 24/365 at a wholesale price of 9c/KWH. With a few tweaks such as increasing the hydro generating capacity to 4GW whilst leaving the storage component as -is, installing even more wind and solar and having a bass link capacity of 2 or 3 GW , Tasmania could produce 2 to 3GW of power continuously at probably a similar cost of 9c/KWH.

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