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Energy storage – a saviour for networks or a Trojan horse?

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Australian network operators are turning increasingly to the use of battery storage to solve their problems with network management, particularly in grid demand. But just as storage looms as a potential glue to keep the networks together, it could just as easily offer the technology and the means to break them apart.

Australian power industry investor Tag Pacific predicts storage has the potential to become a major disruptive technology for the conventional power business – at the same time offering networks a unique opportunity to stabilise their grid management, but also offering customers the opportunity to leave the grid altogether.

Tag Pacific chairman Nathan Wise says the disruption from storage will come because it will challenge the traditional model of centralised generation and transmission over great distances.

The move towards decentralised power generation (such as solar) is changing the relationship with the grid. He says that while storage is needed by the network operators to manage those changes, and new technologies such as electric vehicles, it will also give clients the option of taking themselves off the grid altogether, presenting a new problem for networks

Tag Pacific builds power systems for the mining and petroleum sector, as well as designing and building solar installations for residential, industrial and commercial clients, and supplying components. It also installs trigeneration systems and back-up power systems in the CBD and for clients such as Sydney Airport.

Tag Pacific, through its MPower subsidiary, is currently running a two-year pilot project for Victorian electricity distributor SP Ausnet, looking at how energy storage systems can address demand problems when the peaks exceed network capacity.

The trial is monitoring power demands within individual households and how the use of stored power during peak-load periods can reduce demand on the network and avoid peak tariff rates, cutting costs for householders.

Wise says MPower is developing the “smarts and controls” that sit around the battery bank and which interact with the grid and the solar systems. The system monitors power demands in individual households and stores power for use in peak-load periods, reducing the demand on the network and energy costs for the householder.

The systems incorporate rooftop solar PV, advanced lithium-ion batteries, bi-directional inverters and programmable controllers capable of being monitored and controlled remotely.

Utilities are clearly interested in looking at how energy storage can be used within the networks. Energex, Ausgrid and others are all undergoing trials and pilot projects to look at the potential to use the technology to boost the reliability of networks, particularly in regional areas, and avoid costly upgrades, and to manage the high penetrations of solar, including in metropolitan areas. They are also looking at electric vehicles, and the role of their batteries – both charging and potential discharging –will also have an impact on grid management.

However, while utilities will use storage as a key element of grid management, Wise says there is also potential for battery storage to be used to take homes, and even businesses and communities  – off the grid.

“You can see how this could be quite disruptive,” he says. It will come down to cost, and where the value of storage can be found and exploited – for either the consumer or the operator.

The company is already seeing the economics of storage work in remote areas where the cost of a network connection is very high. “What will be very interesting to see is as the cost of battery falls, whether that impacts on decisions by households and communities to make that move.”

MPower recently won two awards for community storage and control systems in remote communities in WA, and for off-grid renewable energy storage systems for three communities in the Northern Territory.

The WA system – which also addressed issues of periods of rapid weather change – enabled more renewable energy to be used in isolated electricity networks, particularly in the Pilbara region. The Northern territory system allowed for a significant reduction in the use of diesel.

“We are positioning ourselves at the leading edge of the energy storage and power convergence trend in Australia, which these initiatives show has particular relevance for remote communities and individual households.”

Tag Pacific also provides technologies to the solar industry, and Wise says that while the technology is growing in viability, even as most subsidies are removed, it not yet at a “tipping point.” But Wise says that is not because the economics don’t work, it’s more of a lack of knowledge.

“I don’t think solar is the first port of call for households and commercial properties when they look at energy,” he says.

“They look at network connection and solar as afterthought. The penetration levels show it is certainly gaining traction – but councils are not requiring it to be built on new houses.”

But he says most people that do look at it, find there is value in installing solar. “It’s a lack of knowledge rather than economics,’ he says that is holding the industry back.

Still, Wise says it is a difficult industry because volumes and price changes change so rapidly.  “It’s clear that the cost of solar is going down, and the cost of diesel is going up. It’s one thing for the technology to be viable to a customer, it’s another thing to be able to make money from that business.”

 

Giles Parkinson is founder and editor-in-chief of Renew Economy, and founder and editor of its EV-focused sister site The Driven. He is the co-host of the weekly Energy Insiders Podcast. Giles has been a journalist for more than 40 years and is a former deputy editor of the Australian Financial Review. You can find him on LinkedIn and on Twitter.

Giles Parkinson

Giles Parkinson is founder and editor-in-chief of Renew Economy, and founder and editor of its EV-focused sister site The Driven. He is the co-host of the weekly Energy Insiders Podcast. Giles has been a journalist for more than 40 years and is a former deputy editor of the Australian Financial Review. You can find him on LinkedIn and on Twitter.

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