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

“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.