Victoria’s big renewable energy plans face major network hurdle | RenewEconomy

Victoria’s big renewable energy plans face major network hurdle

AEMO report says there are major network constraints for its 40 per cent renewable energy plan, which explains government’s big push into battery storage.


Victoria’s ambitious renewable energy plans – to source 40 per cent of its demand from renewables by 2025 – face a potential significant hurdle because of network constraints in the west of the state.

A new report from the Australian Energy Market Operator suggests that significant amounts of wind and solar capacity could be curtailed if much of the capacity is built – as expected – in the western part of the state.

It is estimated that Victoria’s state-based renewable target will require some 5,400MW of new generation – mostly wind and some large scale solar – and some 3,000MW of this could be built in the west of the state, which is rich in both resources..

But this poses problems. If these installations are built around the 220 kilovolt (kV) transmission lines, which most will have to be, the AEMO study warns that up to half of their energy output could be curtailed – and some network solutions such as building a new high voltage wire could cost $1 billion of more.

The Victoria government is believed to be aware of the issue, which is one of the reasons it is moving so quickly on its new battery storage tender, which seeks to install at least two 20MW battery story installations, with a combined minimum of 100MWh of storage, in the west of the state.

More storage will likely be needed, and while some upgrades of transmission lines are likely, it is believed that the Victoria government will consider location and grid constraints when choosing and allocating wind and solar projects in that part of the state. It could be a reason why the legislation for the VRET has been delayed.

Curtailment is not unusual. It is a growing problem in Germany, and has reached catastrophic levels in China where huge amounts to wind and solar have been built in provinces without proper grid connections. But it is not, and would not be, a good look for the Victoria government.

victoria linesThe AEMO report notes that western Victoria is a rich resource for wind and solar resources, and for cheap land. The electrical infrastructure, however, is “insufficient to allow unconstrained access to all of the new renewable generation” seeking to connect to it.

This map to the right illustrates where the problem lies. The purple lines represent the 220kV lines, while the yellow one is the 500kV transmission line.

The most congested line is 220 kV transmission path that loops between Ballarat – Horsham – Red Cliffs – Kerang. But all parts of the line are expected to have “weak” system strength over time.

And this is the problem. AEMO has received enquiries from more than 5,000MW of potential projects in the area, and 80 per cent of these enquiries are linked to the weak 220kV and 66kV lines. (See graph below).

If the issue is not addressed, more than half the output may have to be curtailed, forcing the state to import electricity from interstate imports.

vic planned projects

“Preliminary studies for the Base Case scenario (3,000MW of wind and solar in the region) estimate that more than 1,600GWh of wind and solar energy per year is restricted by the thermal capability of the Western Victorian network,” the report notes.

“Should there be no action to alleviate these limitations, the constrained generation would primarily be replaced by imports from other regions and generation outside Western Victoria,” it says

Non network options include battery storage – equal to at least 10MW and with one hour of storage. This may not be enough to deal with the whole issue, because on some lines the amount of capacity that could be constrained is 680MW, and for up to 109 hours.

“Due to the MW size and duration of constraints, it is unlikely that a non-network service could completely remove the expected limitations.”

Unaddressed, this is what the level of constraints could look like.

victoria constraints

It explains why the Victorian government is eager to get its new battery storage installations in place – not just to deal with potential shortfalls and issues in the coming summer, but also to reinforce the network to allow for more options.

These are expected to be the first of several large sale battery storage installations, with the government seeking expressions of interest of up to 100MW in total.

The Victorian government’s strategy is believed to focus on non-network solutions, which could also include demand response, and synchronous condensers.

And it will also carefully judge projects for their impact on the grid, and the likelihood of constraints. The best opportunities for developers might come for those who get in early. Certainly, there is great anticipation to see the VRET legislation, particularly given that the national RET is likely to be met within the next 12 months.

It also underlines the Victoria government’s interest in local mini-grids, and other sources such as pumped hydro in old Bendigo gold mines, rather than simply reinforcing the network – which has been the industry’s answer for everything over the last few decades.

Once the non-network alternatives have been addressed, then the government can look at what might be needed in the way of upgraded poles and wires.

Battery storage can add further value by providing Frequency Control Ancillary Services, system restart ancillary services, or synthetic inertia to keep the grid stable. Or, in the case of regional towns, can keep supply for several hours if there is a wider blackout because of network problems caused by storms, bush-fires or equipment failure.



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  1. ben 4 years ago

    As was seen in Pt Lincoln in SA during the “system black” event, a localised microgrid with attendant battery storage and generation would be a much better solution than the existing fragile approach.

  2. George Darroch 4 years ago

    Build it then. The wires will be needed at some point soon anyway.

    • George Darroch 4 years ago

      They will also allow Victoria and the rest of the NEM to take advantage of SA’s abundant assets.

  3. ?? 4 years ago

    Unclear how you get to “up to half” of energy output being curtailed – perhaps because 1600 (GWh) was approximately half of 3000 (MW)? But 3000MW of wind equates to approximately 10,000 GWh per year. So you could say “up to a fifth”…

  4. Peter F 4 years ago

    Batteries, thermal storage etc located near the load have multiple benefits. They can reduce peak load on the transmission system, provide local backup in the case of blackouts or inadequate grid supplies and reduce I2R losses.
    If the peak output of the renewables exceeds the capacity of the transmission lines then storage must be adjacent to generation. In that case the only marketable value of storage is arbitrage between high and low prices so it is much more difficult to make the investment case.
    There is probably a case to favour wind and solar in the east even if it is slightly more expensive both to reduce transmission constraints and to increase temporal diversity.

  5. Ian 4 years ago

    Any solution to this transmission problem should include connectivity with South Australia to the west and NSW to the north of this Great Victorian Energy Triangle. You can use that name for free. !

    • hfrik 4 years ago

      Yes, expanding the Grid makes very much sense, to avoid blackouts, to be able to use more renewables, and to use them at more times, because renewables at different places deliver power at different times. So fas Australia has a very weak grid, compared to other industrialised nations.

  6. Just_Chris 4 years ago

    Surely the answer is to be smart about where we install the renewables rather than to cram them all in one part of the state and the pay for additional storage or poles and wires. what about locating significant renewables near to Snowy 2.0?

    • Alastair Leith 4 years ago

      Snowy 2.0 hasn’t happened and would be surprised if it does. Distributed PHES makes more sense using superior heads available elsewhere.

  7. Malcolm M 4 years ago

    The report concedes that to achieve the State government’s renewable energy target an additional 500 kV line would be needed as far as Horsham. The first constraint on the 220 kV line is between Ballarat and the Waubra wind farm, then with other wind farms on the line as far as Horsham. If these constraints are removed, the next one is the 220 kV line between Ballarat and Morrabool, which has a rating of ~700 MW. There is no way this line will accommodate ~20% of the State’s ~7000 MW demand, even if there were lots of batteries in the sunny north-west of the State. There are other constraints on the 220 kV network between Moorabool and Melbourne.

    Another alternative is to develop more wind capacity into the 500 kV network in south-western Victoria, which has plenty of spare capacity. However output would be highly correlated with existing wind farms such as Macarthur, as well as wind power exports from SA. At present about 750 MW of new solar can be accommodated on the existing 220 kV lines from the north-west with minimal constraints. This should be the first priority for investment, because it would be uncorrelated with current wind output.

  8. Craig Allen 4 years ago

    So imagine enough storage were installed to enable a steady flow of electricity to be sent through the lines, utilising them at their maximum capacity 100% of the time. How many GWh would that be compared to what is being delivered on average now?

    • Malcolm M 4 years ago

      The report is on the AEMO website, but doesn’t directly address this question. The investigation is continuing, as outlined in the “Next steps” section of the report. There are incremental investments that can be made to the 220 kV network, such as duplicating Morrabool to Ballarat line ($57m) and Ballarat to Ararat ($75 m) with towers that could later be upgraded to 500 kV.

      Your question is only of theoretical interest. For practical purposes the primary supply shift would be from daytime to the evening and morning peaks of high prices (perhaps 5-9 pm and 7-8 am), which would allow another 5 hours of delivery, in addition to 9 hours of direct supply (8 am to 5 pm) from PV without the energy losses of battery storage.

  9. caffdan 4 years ago

    Maybe thought should be given to placing more wind and solar east of Melbourne, particularly in the Latrobe Valley where there is no practical capacity limit due to the concentration of existing coal fired generation there. A resident of the Latrobe Valley for many years, I note that it can get very windy here on occasions and quite often when I check the Live Generation data graph from NEM Watch, I see that there is minimal wind generation for Victoria. It obviously is not blowing in western Vic at all. I also note that since the Hazelwood closure, the atmosphere is a lot sunnier and my solar panels output is improved over what I would have expected based on the previous years. So in view of the increased wholesale supply volatility, large scale solar could also be more of an option in Gippsland now than in the past.

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