Energy storage: Will it save the grid, or kill it? | RenewEconomy

Energy storage: Will it save the grid, or kill it?

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The Clean Energy Council says energy storage capacity could reach 3000MW by 2030, but will this be a good thing or a bad thing for the National Electricity Market?

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“Energy storage” and “disruption” are two words often mentioned in the same breath in conversations about energy markets of the future. Thus noted Kirsten Rose in her role chairing the power storage session at this year’s All Energy Conference in Melbourne. And she was right. Speaker after speaker painted energy storage and distributed generation as an unstoppable force, coming to a grid near you, whether gentailers and policy makers like it or not. And they probably won’t.

But the other important message from the same speakers was that this doesn’t have to be a bad thing.

According to Clean Energy Council modelling, the Australian energy storage market has the potential to reach 3000MW by 2030 – a growth trajectory similar to of rooftop solar, and driven by the same triggers; rising energy prices, increasing consumer awareness, increasing renewable capacity, and falling technology costs.

From the perspective of electricity network companies, said GE Energy Australia’s Stephen Szalla, the uptake of solar PV had a negative impact on the grid: effecting day to day operations and cutting into revenue. And storage, he added, “has the potential to make things worse.”

But it doesn’t have to be thus, says Darren Gladman, from the Clean Energy Council. “Distributed generation and storage have a great story to tell,” he told a packed room at the All Energy Australia conference on Wednesday. “(It’s) not a horrible thing to be feared.”

But there’s another but: It’s going to need to be managed properly. And that means putting the right policy and incentives in place, and getting energy regulators on board.

Across the NEM, notes Gladman, vertically integrated gentailers “make a significant chunk of profit from peak demand,” so they will need some encouragement to invest in peak-shaving, load-balancing energy storage.

But they can’t just ignore it, either, said Sonnreich. The CEC’s modelling suggests rational deployment of energy storage in Australia will start with the remote fringes of the country, and move inward. But, he adds, the fact that households are already buying systems “irrationally” is just further evidence that this change is happening, regardless of what policymakers and energy companies are doing.

Growing consumer savvy is indeed a powerful force. As was noted in the previous session, households don’t care if utilities are making money or not, they only care about their bills, and the rising cost of energy. And thanks to nation-wide cuts to solar PV feed-in tariffs, they’re starting to realise that self consumption makes more sense than exporting their solar electricity to the grid.

In Victoria, the government found that distributed generation with storage could save the state’s electricity consumers $437 million per annum – more than half of this coming from reduced network spending.

But according to Sonnreich, “this is not a debate about grids ceasing to exist. It’s about how we innovate. …This technology is coming, and if we don’t have the right policy platform, it will be “the same kind of unexpected and chaotic rollout that we saw with PV.”

GE’s Szalla, a specialist in distribution and outage management,   agrees. “The current grid must exist in some form,” he told the conference. “The brave new world of distributed energy storage has the ability to save the grid,” said Szalla. “But if adapted through a haphazard approach, it could result in a death sprial,” for network companies.

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8 Comments
  1. juxx0r 7 years ago

    I’ll put $10 on death spiral.

  2. Stan Hlegeris 7 years ago

    No matter how you frame it, the situation will remain perfectly simple.

    The generators and regulators got the situation entirely wrong. The owners of the relevant assets (both state governments and corporates) are facing gigantic writedowns on their capital values. They will fight desperately to force electricity customers to pay for their utter mismanagement of public and private funds.

    This simple aim will be dressed up in many different ways. Just say NO to any further subsidies to an obsolete industry, and keep on saying it.

    • Marka 7 years ago

      it will be hard on small business that doesn’t have the ability to generate their own power

    • suthnsun 7 years ago

      I think you are right, they are getting it more wrong by the day. I notice they are heavily increasing new subdivision connection costs, once that is computed over the lifetime of various components and yearly charges, it makes staying away from a grid connection an eminently sensible and cost-effective strategy (for energy supply)
      It is only a matter of time before an even more widespread understanding of self-supply of energy makes the grid irrelevant for new build considerations. The owners of these assets do need to take stock, mark to market and re-think their whole approach.

  3. Chris Fraser 7 years ago

    The energy-spike lovers need an incentive to invest in efficiency and distributed storage. It should be legislated that they are required to make efficiency gains to achieve a certain -MW and then put another certain MW out there in the suburbs as storage. Legislation puts all those generators on an even playing field. As the NEM covers 6 states & territories, i can imagine this would require serious coordination across 6 governments. Still, we hope for more.

  4. Sean 7 years ago

    If there is cost effective small scale storage then the grid as we know it will be dead, or to put it a better way, will go back to what it was before they put all these pesky residential consumers on it.
    in a way this is a win for distribution companies, more concentrated infrastructure serving fewer clients – less maintenance costs.

    The only case this would not happen is if residential customers started selling their power to the grid at less than the generation market.

  5. Rob Campbell 7 years ago

    The ability of distributed storage to empower residential customer who don’t have PV is almost as attractive as for those who do. It doesn’t actually matter whether the storage is at the PV or nearby. Ask long as there is suitable arbitrage of say 20c per KWH. Even the solar ‘have nots’ can contribute to the demise of the centralised distribution model.

  6. Zvyozdochka 7 years ago

    We’re doing a project right now looking at what a typical Perth suburban block might require in storage. The community would own/operate it. Houses are connected to each other on a backbone feeder and to the central storage. The storage is connected to a “grid” of sorts. Excess is fed in when needed and forecasts are used to purchase off-peak or excess from other areas (or perhaps wind energy) to top up.

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