Battery storage take 4: Skinny connections to yield fat savings

Last week at Clean Energy Week in Brisbane there were lots of energy storage products on display. Most of them were focused on the emerging “self use” market where householders attempt to maximise the use of their own solar generated energy in preference to buying power from the grid.

Reports from Europe indicate that “Self Use” is really taking off now that feed-in tariffs are being wound back in key solar markets like Germany. Our local solar market is also preparing for the shift in market behaviour and expected surge in the uptake of energy storage systems.

It now appears that these very same energy storage systems may also be the key to managing a new direction in electricity network charges, and it’s not Time of Use tariffs.

In a disappointing move earlier this year the Queensland Competition Authority increased the standing service fee for Queensland’s 12-month-old Time of Use Tariff 12 from $0.78 per day to $1.13 per day, a dramatic 44.8% rise. Anecdotally, few people have signed up for Tariff 12 in its first year and that’s unlikely to change given that the flat rate Tariff 11 continues to have a much lower $0.50 connection per day.

Given the enthusiasm for Time of Use (TOU) tariffs by the electricity utilities in the southern states, Tariff 12 has been seen by many in the Queensland solar industry as the end game for tackling residential peak load. Why then would the Queensland Competition Authority make this new, opt-in TOU tariff so unpopular? It seems that another solution may be waiting in the wings.

It has been highlighted a number of times that in Queensland, due to the flat rate connection fees charged to residential electricity customers, there is a heavy degree of cross-subsidisation by small peak load homes to support high peak load homes. Or in other words if your house doesn’t have an air-conditioner you’re effectively subsidising the connection costs of your neighbour that does.

With utilities like Queensland’s Energex and Ergon building out their networks to cope with peak load events that occur just a few hours per year, everyone pays so that some can enjoy heating and cooling during the coldest and hottest periods. Much political attention has been given to the alleged inequality of solar homes being subsidised by households without solar power systems. This begs the question “what’s being done about the inequality of connection fees for air-conditioning owners?”

Taking a look at how other markets are dealing with peak load can be instructive because the pressures on network costs being felt in Australia are hardly unique. A recent trial conducted by electricity network operator Alliander in the Netherlands limited household grid connections to just six amps – less even than a single lighting circuit from an average Australian home.

To ensure that the participants in the trial didn’t experience a dramatic reduction in their life styles, the utility provided each home with a 5kW PowerRouter solar power / energy storage system from Dutch manufacturer Nedap. This allows the local loads of each house to actually draw up to 25 amps as required without tripping the six amp connection.

PowerRouters are already available in Australia along with other products with similar Self Use capabilities such as the locally manufactured Selectronic SP Pro.

Restricting the size of the network connection into a house delivers a range of clear benefits to utilities in terms of network augmentation and complexity as well as to customers by driving increased energy efficiency. From the utility’s point of view they don’t have to estimate peak load, they just add up the connection sizes for each customer on each suburban transformer.

For consumers, especially small ones, being given the option to pay a network connection that’s just the right size is a great opportunity to save money and stop cross subsidising high electricity users.

Considering the Queensland government’s recent investigation into “Fair and Reasonable” Solar Feed-in Tariffs, it seems like offering customers the chance to pay only for the connection size they need will deliver great social benefits as well.

A further benefit is that inefficient and high draw devices like air-conditioners, electric storage hot water systems and pool pumps will be more closely scrutinised when customers can see the implications to their bills.

Under such a scheme Time of Use tariffs become effectively obsolete and utilities can continue to charge flat rate tariffs, which are far lower risk from a technology point of view.

Combined solar power and energy storage systems offer a clear path forward to make such skinny network connections a reality and deliver savings for both utilities and consumers. These systems produce solar power during the day with excess production “banked” for evening use. The integrated energy storage also acting as a buffer to ensure the network connection is never exceeded.

Advanced capabilities available with these energy management systems also include modern luxuries like customer web portals, household consumption monitoring and daily power production summaries. In the near future it’s expected that utility fleet management will also be rolled out to placate any fears the network operators might have.

Energy management systems featuring solar power and energy storage systems are the future for household electricity and now we just need skinny connections to unleash fat savings for frugal consumers and network operators alike.

 Dane Muldoon is commercial sales director of Solar Guys, a Queensland company that installs solar panels and battery storage products.