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South Australia launches biggest solar + storage trial to defray network costs

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 SA Power Networks has announced the biggest trial of rooftop solar and energy storage of its type in Australia, in a bid to prove that the new “distributed generation” technologies can avoid the need to build additional network infrastructure, and so save customers money.

The trial by SAPN – the monopoly network provider in the state – will install around 100 Tesla Energy and Samsung batteries at deep discounts and install software from Canberra-based Reposit Power.

salisbury

It will be located in the northern Adelaide suburb of Salisbury and is believed to be Australia’s largest trial of combined solar and energy storage in an established suburb.

The unique trial – to be unveiled at the Energy Networks 2016 conference in Adelaide on Thursday – will begin in June. The network operators believe using solar and storage can avoid the need to spend more on grid upgrades and expansion as demand increases, underlying the value of “distributed generation.”

“In the next few years we will need to act to meet localised demand growth in Salisbury. We want to work with customers to avoid the need to invest in new poles and wires,” said Paul Roberts, SAPN’s head of stakeholder relations.

“Instead of building a new power line, we would like to see whether we can defer or avoid that by tapping into local solar PV generation and combining this with energy storage.”

SAPN estimates it will need around 100 customers to take up the offer of solar and storage to enable the company to defer the investment. The trial will be funded by the anticipated savings from the deferment of network spending and from the demand management investment scheme funds.

It will be approaching customers in Salisbury – with minimum grid consumption of 4,000kWh a year (or 2,500kWh if they already have solar) – over the next few weeks inviting them to register their interest. They are certainly being offered an interesting deal.

Attendees take pictures of the new Tesla Energy Powerwall Home Battery during an event at Tesla Motors in Hawthorne, California April 30, 2015. Tesla Motors Inc unveiled Tesla Energy - a suite of batteries for homes, businesses and utilities - a highly-anticipated plan to expand its business beyond electric vehicles. REUTERS/Patrick T. Fallon - RTX1B27W

Customers wanting to buy an entire system of 3kW of rooftop solar and the 6.4kWh battery storage package will pay just $6,150. If they already have solar and just need the battery, then the cost is just $3,600 – a vast discount on current prices.

Another option is for customers to buy a 3kW rooftop solar system for $2,550, and rent the battery for a $500 upfront bond and a $18.50 fortnight payment over three years. The battery will remain the property of SAPN.

There may be other costs associated with meters (if installing solar for first time), additional electrical works that may be required to support the installation of the system, and an ongoing monthly fee for the monitoring equipment if customers want to use it.

The customers will be guaranteed a minimum $500 saving on their electricity bill.

SAPN chose Tesla and Samsung batteries after an open tender, and SAPN decided they met their specifications. Both will be offering 6.4kWh systems that are currently available in Australia – considered to be the leading battery market in the world.

The trial will also use energy management software provided by Reposit Power, which will help determine the best option for customers in utilising power being generated by their PV panels or stored in their battery, and potentially for trading with the wholesale market at peak times.

The trial – and the buy-in by the network operator – is significant because it helps change the rhetoric about rooftop solar; particularly in a state which recently closed its last coal-fired generator and is leading Australia, indeed the world, in the integration of wind and solar resources.

Instead of being demonised in some quarters as a cost to consumers – courtesy of over-generous feed in tariffs, and despite some obvious network benefits – the combination of solar and storage is seen as a big benefit to individual and other consumers, due to savings on networks costs and wholesale markets.

Roberts says the combinations of solar PV, battery storage and grid connections are the “future of energy provision”. Indeed, studies suggest that up to $400 billion will be invested by customers over the next few decades in rooftop solar and battery storage.

“With the right settings and approach they will provide benefits for customers and to us as managers of the network and also help contain long–term network costs for customers,” he said.

“We are excited about the future and the opportunities due to advancements in solar and storage technology. We think our distribution network will be a vital component in helping our customers and our state to derive the greatest benefit from investment in these technologies.

“The trial gives us an opportunity to explore the customer, technological and capability impacts on our regulated network business.”

south australia network

But the trial also has broader implications, both for the design of new energy systems and for the uptake of solar and storage, and for the management of networks and the future of current business models, both for those networks and for the operators of centralised fossil fuel generators and the retailers.

One issue is around the ability of networks to access the “consumer” market and make offers to customers on solar and storage to help defray costs. A recent study by Victoria’s network operator Ausnet found that the benefits of rooftop solar and storage were about equal for consumers and networks.

Roberts said the trial in Salisbury – like the tender it has put out for Kangaroo Island, where a cable to the mainland could be replaced by localised storage and generation – is about management of the regulated network.



“This is absolutely about management of the regulated network, and exploring how we can be using customers to avoid the need for network investment, and to address capacity issues in the network,” Roberts said.

“The rules encourage us to look at long-term options. We should explore opportunity for customer integration. We believe this is what managing networks into the future will be about.”

But new rules being discussed by regulators, and pushed hard by retailers, want the networks to be restricted through “ring fencing”, to only using the “de-regulated” part of their business to address customers. It is going to be an interesting battle.

  

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  • DevMac

    Is it the Salisbury council area or just the suburb? I’m in the council area but not the suburb. I’ll be trying to sign up either way, and if I get the nod I’ll keep y’all updated with all the worthwhile stats!

    • Majority Salisbury but includes parts of the following suburb)s:

      · Brahma Lodge
      · Elizabeth Vale
      · Gulfview Heights
      · Salisbury East
      · Salisbury Heights
      · Salisbury Park
      · Salisbury Plain

      • Paul

        What about NSW???

      • DevMac

        Cheers Giles, I’ve now signed up / registered my interest. We’ll see where this goes.

  • A1

    hmmm on long term contestability…

  • Nige

    Well. I commend the glimmer of innovation by a network.

    However, although I don’t know the total allowance available to all networks this submission from one network company shows they have around $1M p/a. This will be recovered through a network cost pass through to consumers. So, as an electricity consumer and solar retailer I pay my network who uses that money to compete against me in niche projects which are cross subsidised by every consumer in the state.

    It’s important that networks get incentives to modernise but distorting the market in this way is discriminatory against every solar company who can’t access these subsidies – and we are getting on and doing without them.

    https://www.aer.gov.au/system/files/TransGrid%20-%20Appendix%20R%20-%20Demand%20Management%20Innovation%20Strategy%20-%20May%202014.pdf

    • World Citizen

      if you are a solar retailer and/or looking to get into batteries you need to be making noises about these ring fencing rules being written right now:
      http://www.aer.gov.au/networks-pipelines/guidelines-schemes-models-reviews/electricity-ring-fencing-guideline-2016

      it’s a massive document so i would suggest making a short submission saying you want complete separation and thorough auditing.

      also tell your colleagues and other businesses. lobby your small business commissioner. If the AER don’t hear from the market they will assume they don’t really care.

      otherwise this cross subsidy you talk about will be locked in place.

  • Ken Dyer

    The success of this trial and the implied implementation of others essentially makes the job of the Australian Energy Regulator more difficult. These bureaucrats would like nothing better than to maintain the status quo, centralised top down economic control of power distribution. The AER determines pricing and distribution structures and this initiative would be deeply unpopular in Canberra because of Australia’s current Government committment to fossil fuels for power generation.
    The disruption continues.

    • Ian

      The way to break up a large rock is to chip at it. Death by a thousand cuts. Every successful trial, and every distributed solar installation and wind farm is another cut into the fossil fuel regime. Fortunately large companies and institutions are taking up the cause. Reneweconomy has documented this process so nicely. Don’t worry about government’s rage, they are powerless in this movement.

      It only takes solar’s 1/4 of the day’s power generation to push up the price of coal’s generation by about 25% simply by taking away that amount of consumption. The only way they can recover their relevance is to embrace storage.

      • Alastair Leith

        that’s if PV had a nameplate capacity like coal, it’s more like 10% or less so that pushes the coal price 2.5% 🙂 bring on the PV revolution though.

        • UTM

          Mine gets 20% for the year. Just the basic setup, no fancy tracking.

          The PV revolution is here! I am saving money and spilling emissions free electricity into the network for other people to use.

          • Alastair Leith

            nameplate capacity of deployed PV is not the same thing as your PV panel efficiency! glad you’re part of the revolution. It’s really the nameplate times the Capacity Factor (yours is 20% which is about the weighted average I expect) that counts, and I’m estimating that to be around 10% in the NEM, while it’s possibly less.

          • UTM

            It is 3kW capacity and it produces 5.4 MWh per annum. That’s 20% is it not?

          • Alastair Leith

            yes i get 20.5% C.F. for your system.

            I’m talking about the amount of PV going into the grid (energy) compared with the amount of energy the grid consumes. I think nationally ~10% is about the right number (or less) without looking up an AEMO or CEC report.

  • Zvyozdochka

    Individual household batteries, I would suggest, are likely to be an inefficient distribution of capital and capability. A large battery micro-grid shared by perhaps 24 houses, connected to a traditional-grid as ‘trickle-charger’ might be the future.

    • George Michaelson

      I agree. And they should be trialling Redflow systems which appear designed to scale directly for this function, and are backed by people in SA.

    • Ian

      Not at all, distributed storage is an exact match for distributed solar. The point of production storage and use is at the exact same point no distribution costs involved. Subsequently the network can be much reduced in size. A minigrid can still be designed around this with a secondary standby type storage or trickle feed from the wider grid. Capital is best kept in the hands of the individual than in the company or collective after all it belongs to the individual doesn’t it. But the last point is philosophical and quite immaterial to the actual problem of storing solar for night time and inclement weather use.

      • Alastair Leith

        it’s material if the grid can do storage or virtual storage (DSM, spreading distributed exports over the network) at a fraction of the cost that individual premises can.

  • Chris Fraser

    This is remarkably progressive and should be lauded. In the east, we’re routinely disappointed by the attitudes of our DNSPs. A couple of small questions for SAPN :-
    Once the distributed batteries are topped up with solar and household loads have finished, will they permit export for a reasonable export tariff ?
    Are the batteries for household uses ONLY ? That is, if batteries are topped up overnight using off peak energy, can the batteries be called upon to smooth the AM peak in the distributed system, before solar charging ? And what is the export tariff for that ?

  • Brunel

    The batteries should be installed in schools, unis, hospitals, dental clinics.

    • DevMac

      Solar panels should be installed on schools, unis and dental clinics before batteries are deployed as their use-case is highly skewed towards majority daytime usage.

      Hospitals should have both solar panels and batteries since their use-case is probably fairly consistent between night and day.

  • David Pethick

    Interesting. I’m hopeful that this will be a demonstration of shared benefits being allocated efficiently.

    It looks like a subsidy of about $5k per household, or $0.5m across 100 households for the trial. The sample size looks big enough and the cost low enough for this to be worthwhile, particularly given the claimed benefits.

    I’m a bit sceptical that demand shaving from only 100 houses (~1% of the number of dwellings in the area) could avoid the need to invest in new poles and wires. That said, I have no idea what that cost could be so perhaps even just delaying it for a few years justifies the cost.

    I look forward to hearing more. This is certainly something we want and need our LNSP’s doing.

    Dave P.

    • hydrophilia

      Interesting, indeed.

      Perhaps they think a delay of a few years might be enough for even better solutions to come out. They may never need the network investments they are avoiding.

    • Pfitzy

      I think perhaps its a case of trying to prove the tech before spending too much money. You can learn a lot from 100 households, particularly with the Reposit controller doing what it does to maximise SAPN’s ability to tap into that stored power – 600kWh of it – to help prove a big point.

      Particularly in a network that increasingly looks to be a standalone renewables beacon.

    • Alastair Leith

      if the population density of the area is stable, then arguably demand could be falling for that area anyhow due to EE and bigger PV systems. the information will be critical in designing new suburbs and areas with increasing density though.

  • World Citizen

    Giles, imagine how unfair it would be if the knowledge and experience gained by SAPN in this ‘trial’ (effectively done at zero commercial risk) is then able to be used when they compete against small solar/storage operators?

    this is a huge issue for the thousands of small operators. unfortunately most small businesses don’t have the time to get across or lobby on these issues until they are actually happening.

  • Ian

    The more experience that is collected with these sorts of trials the better, also the more battery systems are installed the more confidence manufacturers etc have in these products, hopefully to finally kickstart the positive feed back loop between manufacturing, installing, consumption and prices of battery storage systems.

    Interesting that the network will fund these currently expensive batteries with savings from network infrastructure.

    Now that South Australia has unshackled itself from coal it is now free to experiment and innovate. Hopefully a lot more of these distributed solar and storage systems , in all their forms, are initiated before that solar thermal thing gets off the ground.

  • Rini Limburg (Irene)

    I would love more information if possible. If its for country sa, please contact me. I have solar connected and would love battery backup etc.