Consumers warned against emotional storage investments in ‘chaotic’ market

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Energy industry insider says it’s still not clear why the average consumer should invest in battery storage, particularly in Australia’s ‘chaotic’ market.

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Not everyone is buying into the Tesla-driven hype about energy storage. At least not Mike Swanston.

The former customer relations executive with Queensland distribution business Energex told the Australian Solar and Energy Storage conference in Melbourne on Wednesday that the new wave of battery technology – including Tesla’s Powerwall – were still in the “Bunnings” category: “I love that, I just wish I had a reason to use it.”

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Beyond those people making “emotional investments,” Swanston says, it’s still not clear to the average solar consumer, or those without solar, why they would want to take the leap and invest in energy storage.

Particularly, he added, while Australia’s energy market was stuck in the “chaos stage” of its low-carbon transformation, and not looking like coming out of it any time soon.

“The renewables industry is a tremendous industry,” Swanston told an industry-heavy audience at Melbourne’s Exhibition Centre, “but by crikey it needs some direction.”

“We need to work out what, exactly, the problem is; what does success look like? Who will lead a whole of industry response? …But as long as you’ve got 10 different views on that, you’ll never get out of the chaos stage.”

Adding to the chaos, he says, is resistance from incumbents, rapidly increasing rates of self-consumption, households using an average of 15 per cent less energy, a failing distribution model, and piecemeal regulatory and political responses.

And it’s for all these reasons that renewables are not truly gaining traction in Australia.

One of the biggest problems to solve, Swanston said, was the role of the distributors going forward.

Regulators need to generate something for networks to satisfy the What’s-In-It-For-Me factor, he said.

While low-cost technology allows people to install solar, or solar plus storage, or even go off-grid, distributors will always be able to argue that this leaves those who cannot do this – low-income households, or people who do not have the available roof space – carrying the can, he said.

“These are two very valid arguments, …and this is what we need to have a conversation about.”

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15 Comments
  1. phred01 4 years ago

    dirty coal rear guard action story

  2. Michael Skeggs 4 years ago

    It is strange how people with a vested interest, e.g. “former customer relations executive with Queensland distribution business Energex” see renewables as chaotic and needing regulation to incentivise networks, while millions of households around the country are just getting on with it.
    I’ll take my silent, pollution free, maintenance free, fuel-cost free solar panels and the accompanying chaos, over a traditional model thanks.

    • Askgerbil Now 4 years ago

      Couldn’t agree more.

      The Government’s recent Energy White Paper includes the idea favoured by electricity industry vested interests that will allow them to charge consumers 70 cents or more per kilowatt-hour in peak periods. People can opt out of this money-making scheme/rort by installing energy storage systems.

      The Government’s Energy White Paper contains the following prescription that makes battery storage a useful preemptive investment:

      “Cost-reflective electricity tariffs give consumers better price signals about how they use energy. Consumers will increasingly be charged according to what it costs to supply energy at the time they use it.
      Price signals discourage use during peak times, when energy is most costly to deliver, taking pressure off the network and reducing network costs, which are around half of the total electricity bill.”

  3. Robin_Harrison 4 years ago

    Yet another article from an apologist for ‘business as usual’. One would think Renew economy would be more discerning.

    • Doug Cutler 4 years ago

      I wonder if it wasn’t just a tasty treat for commenters.

      • Robin_Harrison 4 years ago

        You would hope so. The alternative is a bit ordinary.

  4. Pedro 4 years ago

    We can thank the LNP, their FF buddies and the NEM for creating the chaos in the first place.

  5. ChrisEcoSouth 4 years ago

    Quite simple, really. We are putting the final touches on our first peak-shaving/load-shifting solar-battery system. Because it cannot supply power in a power-cut, it is way below my initial cost-estimates.
    Consumers will lead the way by using their increased independence to walk away from energy retailers. Don’t shift blame by saying low-income households will suffer – the whole National Electricity Market was established on some understanding that did *NOT* include consumer independence! However, wasn’t the NEM set up supposedly as a ‘free-market’? – so don’t go crying when that ‘free-market’ decides to do something that wasn’t in your plan!
    Time for it to be de- and re-constructed I think.

  6. Ken Dyer 4 years ago

    Rubbish! The fossil fuellers always trot out the “poor are carrying the can” scenario. What this advocate for the brown economy failed to mention is that the National Electricity market (NEM) is controlled by vested interests who want to hold prices artificially high so they can screw those who cannot afford solar PV out of every dollar they can get.

    The fact is the marginal cost to produce electricity from solar is NIL; The marginal cost to produce electricity from fossil fuels is getting more expensive. This spot prices file shows that spot prices have declined substantially in the last 12 months reflecting the impact of solar, wind and other renewables.

    http://www.aer.gov.au/sites/default/files/20150419%20-%2020150425%20electricity%20weekly%20report.pdf

    The Government does not want you to know any of this this, but the fine print on Government websites lets the cat out of the bag.

    http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/Browse_by_Topic/ClimateChange/cprs

    The battery market may appear chaotic, but there are three trillion dollar industries spending billions on battery technology R&D right now. They are the IT industry, the electronic vehicle industry and the power storage industry. The price of battery technology has dropped 14% every year since 2000, and the Tesla Powerwall has disrupted and accelerated that fall.

    • Miles Harding 4 years ago

      Chaotic may be good, if we mean diverse and resilient.
      This would make the fractious battery market everything the centrally managed and optimised generation and distribution systems aren’t.

  7. Evan A 4 years ago

    ‘Regulators need to generate something for networks to satisfy the What’s-In-It-For-Me factor, he said.’ That sums it up. Why innovate, improve, dematerialise processes or improve productivity? Lobbying the LNP / ALP to stitch up the public is a tried and true formula!

  8. Horst 4 years ago

    Here is another press release, this time from the food industry:

    “The only meat you should be eating is chicken”, says meat industry expert Colonel Sanders.

  9. Miles Harding 4 years ago

    Next they will be claiming that we are all committing an assault with battery against these poor corporations that have been so sure of their primacy and controlling position that they have failed to engage with consumers in any meaningful fashion.

    Never mind emotional investments, these guys should to be fearful of social, environmental and ethical arguments, soon to also include economic in the list of reasons to install a battery.

  10. Murray Hancock 4 years ago

    Brief conversation about “two valid arguments”: 1) Low income households get safety net handouts under national welfare policy. We don’t want extra layers of policy and bureaucracy in response to this furphy. 2) Innovative distributed platform service providers will compete to service roof space-challenged customers using micro grids, ever more efficient load management and distributed generation resources – and even the grid, if regulators and distribution utilities get their act together.

    There is no need for a “whole of industry response” and I can’t see there being one. There is more chaos in incumbent and policy quarters than anywhere else. The (non-monopolistic) private sector just gets on with creative destruction, as it does. There is plenty more coming down the track like the Powerwall and there will be lots of winners and losers. Hooray for that!

  11. greenmail 4 years ago

    Great report Sophie, keep on parading these dinosaurs around the ring and naked. You sure got the boilers fired up in the comments. I could almost turn a turbine with the steam.

    I guess poor old Mike Swanston will soon get to hear the decade old conversation and he might even see a purpose for that battery technology as he appears to be freed of the blinkers as an ex energex spinner.

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