Lousy weather won’t save Victorian networks

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Victorian’s can live without their grid if they’re forced to through unfair pricing. Even with that state’s fickle weather.

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cloudyIf Victorian distributors think that the state’s more southern latitude and less ideal climate will make them immune from the most serious impacts of the power utility Death Spiral, then they should think again.

The reality is that things are changing and fast.  Installed off-grid battery prices will drop by more than two thirds versus today’s cost by the end of the decade as battery production becomes the next solar, and wind – with a Chinese state of the art manufacturing – scales up. The cost of unsubsidised solar panel installations is predicted to almost halve in price in the same period.

In the past, many thought of Victorian power distribution networks – particularly those with customers south of the Great Dividing Range (where it is less sunny) – were as immune to their customer bases leaving the grid.  However, today, the scenario of large numbers of customers leaving the grid is highly likely if the networks try and squeeze power customers for more to maintain their existing unsustainable uncompetitive business model as overall volume demand and critical peek capacity requirements decline.

If you think Melbourne’s short cloudy winter days means rooftop solar power can only provide 10-20% summer solar, think again. A new possibility has emerged, given the massive drops in the price of solar panels and increasing efficiency (watts per square metre),where a customer can  install an over-sized PV array for their inverter (say 300% or 400% of their inverter capacity rather than a bigger inverter as inverters still cost money that can be saved) using dirt cheap panels e.g. connecting 15 kW of panels to a 5kW inverter. Combine this with 10kWh or 20kWh of batteries and a PV system owner will get much higher winter solar power production.  This option is available to about the two thirds of Victorian customers who live in detached houses with sufficient roof space.

With such a system, customers could disconnect from the grid nine months a year, reconnecting on approximately May 15 and then disconnecting again August 15, and still produce the majority of their winter power requirements relying on the grid for a few hundred kilowatt hours of last resort. ($50-$100, of off peak power).

The driver for this move to oversize PV arrays will be the distribution networks’ poor response to solar.  They plan to recover their revenue by the fixed daily charge to top up revenue from falling demand.  The networks, Left to their own devices (Without proper regulatory or government oversight in the interest of consumers) will be charging $3-$4 a day for households to access the network, so a customer who disconnects will avoid  –  $820 – $1100 a year in these charges.

If the networks respond by trying to lock customers in with 12 month minimum connection terms or introduce exorbitant connect and disconnect fees, then it will detrimentally affect the poorest in society who suffer from the bulk of disconnections for not paying bills, and who move from supply address to supply address more often than any other part of the customer base.  This would look very bad for the networks as they slug battlers in an attempt to put a lid on mobile customers who are exiting the grid in favour of their own capacity and kWh solution through solar and batteries.  This would all be in a vain attempt to protect their old out-dated business model.

But there is another way that works for everybody!

The alternative for the networks, so as to not cause their ultimate downfall and to keep customers connected, maintaining a business model with all customers (albeit many that will generate much less revenue) is to at least have those who want to look after their own capacity and volume requirements paying a minimum amount to match the service level they actually require. (Which will ultimately be 1kVA (1kW) or 2kVA (2kW) of capacity) instead of paying for 20kVA all you can eat (with an average of 5kVA during super critical peaks).

Charging customers per kW of network capacity they require would allow solar customers who invest in their own systems to buy 1-2kW of usage  from the grid, instead of a flat rate for capacity access regardless of how much capacity they use (even during a super critical peak when capacity is at a premium) which is the situation today.

The networks have a choice and yet they seem to want to bring on their own death spiral through upping their customers’ daily service charges to counter reduced consumption by solar and energy efficiency.

This is more brown madness –and ironically network operators aren’t even in the business of selling fossil fuels just transporting electricity and it shouldn’t matter to them which kind of electricity so they should really embrace and get with the renewable program so that they can share a future with renewables rather than be remembered in the past along with dying centralised fossil fuel behemoths

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28 Comments
  1. Chris Fraser 5 years ago

    i, too, suspected that mobile customers are receiving the proverbial short end. Connections and disconnections from simply relocating doesn’t involve any tangible attaching or unattaching of wires. Customers who relocate but have access to the same retailer in a certain network area should be able to get a near-seamless continuity of their energy bill, with same account number, even if occasionally it includes a change to a different NMI number.

  2. David Osmond 5 years ago

    If the retailer increases the connection/disconnection fee too much, then people will instead get a diesel generator to see them through the worst months of winter.

    • Matthew Wright 5 years ago

      David,

      I agree. So they will tie themselves in knots if they do not cooperate and work with customers who only need a connection of last resort for security of supply.

      Matt

      • coomadoug 5 years ago

        David
        One problem is the politics are so aligned to help coal industry, they will charge you for the connection even if you don’t have it. If you disconnect your water, you still pay a lot. People bought tanks and did the water thing to save the nation from drought. Then when they couldn’t sell enough of their water they charged us for not using it.

        The coal industry is subsidised to about 18 billion dollars a year in Australia already. There will be not much twisting of political knobs required to do more. Please remind the big coal people this when they tell you how much the government is helping renewable s.

        • Matthew Wright 5 years ago

          Actually the precedent is with Telstra. Telstra has not been compensated in anyway for all the people who disconnected their copper land line. With the water authority it is about public health, preventing everyone dying from diseases. So I am optimistic that they won’t be able to pull that manoeuvre.

      • Miles Harding 5 years ago

        This will be the real cause of any death spiral. Like an encounter with star trek’s borg, resistance is futile.

        All of the discussion in these columns serves to convince me that some serious competition is needed to allow these dinosaurs to quietly go extinct. Nothing short of deregulation total destruction of the existing monopolies who resist change will suffice.

  3. Zvyozdochka 5 years ago

    Matthew, what daily consumption do you base the need to reconnect to the grid on?

    • Matthew Wright 5 years ago

      Will depend on the house but for a somewhat representative example lets say
      about 15-20kWh per day (in Melbourne) during the winter.
      That’s for an all electric house that heats with reverse cycle air conditioners and does hot water with a heatpump such as a Sanden CO2 heat pump.

      And about 13kWh per day averaged over the year.

      • coomadoug 5 years ago

        Matthew
        I was a 13 KWH a day home too but now the three kids are gone I’m using less than half of that. The peaks can be managed now without extra generation being spiked onto the grid. Instead we can smart switch loads to manage the peaks and reward customers with reduced costs. We could have a cheap device on your home switch board. This could be a frequency meter. When the frequency reduces to 49.8 hz, your hot water, your air con and other selected devices could be reduced in output. For the purpose of stability management this may only be necessary for 5 or 10 minutes.

        The energy market in Australia has a 5 minute settling period. It is designed in a way that pays well for us to ram energy into the homes even if they wouldn’t miss it if we managed the load more selectively

        If we had a million customers and we could switch off 1 kw from these customers when the frequency required it and when we had stability issues, this could do the job of billions of dollars of existing peak generation plant.

        I really think we can flatten the load peaks enough to save an absolute fortune in infrastructure.

        • Matthew Wright 5 years ago

          Hi Coomadoug,

          If you’re in sync with the grid your frequency will be exactly the same as the entire grid. So you can’t use it for signallying. There are a number of home automation standards now and new appliances (and appliance retro-add-ons) allow you to control devices. One such system uses the zigbee wireless standard the same as our smart meters (in Victoria).

          • coomadoug 5 years ago

            Matthew

            I have been working in the control of system frequency on the national grid since 1982. In the organization I work for we use the frequency as the signal for system stability response. The frequency is the same everywhere yes.

            i recall one time on shift on a public holiday and the frequency fell to 49.0 HZ. I started 1000 MW response immediately based on that number and no other information. The Machines i started corrected the frequency excursion and possibly saved the grid from a major system black. The information i responded to was the 49.0 HZ.

            There is no reason we can not reward customers by having a frequency device at their home that will switch off load in response to such numbers. There is no need for a signal or communication connection. The frequency of the power at the home is adequate information.This response will be not only instantaneous, instead of a time lapse of a few minutes in the case I talk of above, but will be much more effective in providing limitations to the surge impacts and system stability fluctuations. That fact that it will be spread across the grid and instantaneous is a huge advantage.

            The fact that the response is the switching off of momentarily unnecessary power rather then the slow synchronising of make up energy, is itself a huge advantage.

            The difference is even more striking when you consider that instantaneous response initiated by frequency excursion actually does the same job with much less energy required and negligible infrastructure. Still further and with more reward, we could target the response based on location and the energy grid flow constraints that change dramatically in such events. This finer targeting of load shed response would require internet connection, but would enable a much smaller load shed and a much faster recovery from the excursion. Again all done without a generator started.

          • coomadoug 5 years ago

            Late I know but must say this.
            The frequency is not exactly the same everywhere on the grid when you look inside the first half cycle.
            It varies and is the result of power swings caused by large disturbance. New technology that enables switching loads within 5 milli seconds can be achieved easily just measuring the frequency at the load points.
            The old base load idea cant do it that way and they are the cause of the power swings.
            Switching loads within 5 milli seconds and dispersed across the grid according to power swings will enable system stability control at virtual zero cost apart from control system development.

    • Chris Fraser 5 years ago

      I had to run a ruler over my own hip roof looking for kWh capacity. If I use the forthcoming 250w panels on the north and west facing roofs, placed so that they don’t come within 400 mm of the hips (to avoid getting some of them blown off in one of our SE storms), we have potential for 45 kWh per day averaged over the seasons. Plenty for ourselves and to give away during short blackouts, but not great after adding an EV some day.

  4. coomadoug 5 years ago

    If you only need a couple of hundred kilo watt hours a year back up, why not spend 1000 dollars and buy a nine kilowatt standby generator.

    • Motorshack 5 years ago

      I have had the same idea, and even suggested it on this website once or twice, but the numbers may be rather unattractive, as it turns out.

      In your example, let’s say you do spend $1K and keep the generator for five years, producing a total of 1000 kWh (200/year). That looks like a dollar a kWh just for the depreciation on the equipment.

      A glance at some generator specs, and a little arithmetic suggests something on the order of another dollar per kWh for fuel, for a grand total of $2/kWh.

      I may have dropped a decimal point somewhere, so you can do your own numbers to see what you get, but if I am somewhere near correct, then a generator is only cost-effective if you absolutely must have the power, and you really have no other more normal option.

      More to the point, even the coal-fired dinosaurs running the grid might be able to undercut $2/kWh by a noticeable margin.

      • Matthew Wright 5 years ago

        Personally I wouldn’t want a generator at home. I’m not overly excited about that idea (though from a greenhouse perspective it wouldn’t be any worse than grid derived energy’s current environmental performance).

        However if the grid operators force us into that corner it is where we will likely go. Oversize our systems to the max (whatever we can get on our roof – including squeezing more production through the use of high performance panels @ 23% module efficiency (available 2015) and so on

        • Motorshack 5 years ago

          Yes, I wasn’t pushing the generators either; just the opposite.

          I happen to live in a place where the whole grid goes down a couple of times a year from ice storms, and in those situations a generator is very nice to have, so lots of folks here do have them. However, I don’t own one myself, because camping in a cold, dark house for a couple of days does not bother me much. If I have a decent LED flashlight, some extra batteries, and a pile of books, I do just fine.

          So, until today, I had never had any reason to analyze the operational costs, which are apparently pretty steep. You probably would not want to use one on a steady basis. Certainly no one around here turns theirs on when the grid is running normally.

          Plus, our grid-supplied power is already fairly low carbon – big nuke, quite a bit of hydro (with more coming soon), and very little remaining coal – and it is only 17 cents per kWh. Moreover, my neighbor who did just put up a big solar array tells me the power company was very reasonable about the grid-tie and net metering. There was nothing like the nuttiness that you guys are seeing in Australia.

          I’m not sure why our power company is so reasonable, but I do know they were beaten up so badly by the costs of building the nuke 30 years ago that it drove them into receivership, so perhaps with solar PV technology they are a little quicker than average to notice the advantages of letting the ratepayers put up the capital for more generating capacity directly out of their own pockets.

          In any case, having seen the fiasco with the nuke, I am perfectly willing to believe that your power companies could be more than stubborn enough to ride the plane right into the ground, without once using the parachute, or even considering it at all seriously. So, I think you are only prudent to be brainstorming busily about the available alternatives.

          I just don’t think small gasoline generators would be cost-effective in anything but fairly serious emergencies.

      • coomadoug 5 years ago

        Motorshack

        I urge you to think out of the square and come up with some concepts as I have done here. Lets float some ideas.

        Incidentally if you spend a thousand dollars on solar installation you will generate about 1200 KWH a year.

        I walked past a local hardware shop and saw a 9KW generator for 1200 dollars. I thought gee I might buy that to ease the supply anxiety. I wouldn’t use it much at all. In fact I would hate using it. However, what if we had four like minded close neighbours we could share the purchase and establish our own connections to the shared back up gen.

        But then we would be able to share the use of the combined solar system. There is also the option to utilise a gas operated fuel cell.

        What I see coming though, is the existing network shrinking back to major infrastructure of the cities and our energy at home being provided by our solar and when in short supply the car will bring energy into the home from the major grid. This will be the launch pad and storage resource for the wind energy sector and also provide around the clock back up for the major grid.

        Again, at home, this energy sharing across a few homes could include the cars that are smart switched, integrating the travel plans of the local fleet and the energy use of each home and the costs also smart balanced in the car analysis process.

        Much of the world is moving to increasing numbers of people living in high density. So the renewable energy will need to be large scale solar and wind into the heavy infrastructure grid. The storage will be provided by the car to a large extent.

        What do you think?

        At the moment when at work I see loading on the national grid surprisingly less then we are expecting and still accustomed to almost every shift.

    • Miles Harding 5 years ago

      I agree with motorshack, the electricity produced will be expensive.

      Another factor may be the network operators response to the death spiral, by shifting revenue from consumption to network costs.

      In this environment, disconnecting and sending back the electricity meter may be a good option.

      • Motorshack 5 years ago

        Glad to see everyone is enjoying this little brainstorming session.

        As for thinking out of the square, let me point back to what I said about sitting out an ice storm with my LED flashlight and a pile of books.

        That might sound a little hardcore, but there is a definite method to this sort of madness. I grew up in a very cold climate, and started doing winter camping when I was just ten years old, in a canvas tent, with no artificial heat at all. Just my body heat and lots of good bedding.

        The point is that even in the dead of winter, on a sub-zero night (Fahrenheit, that is), it is easily possible to sleep very comfortably with no special technology at all. Just stuff our ancestors have been doing for millennia.

        At one point in my life, to save money aggressively, I spent several years sleeping in an unheated van (the original Motorshack, as it happens). Vans are water- and wind-proof, so they are much better than tents, and the bedding works just as it would in a tent. Indeed, better, because there is no chance of it getting wet.

        Another example would be cooking and baking in a cheap, simple solar oven.

        I have also taken lots of showers with solar-heated water, using a gravity-fed bucket as a reservoir. I put a dark bucket of water in the sun all day, then pour it into the shower reservoir at dusk and take a shower. Total capital cost was about $20, and the operating cost is zero.

        I also now have regular plumbing again and a hot water heater, but on sunny days I still use the solar set-up, and save on the electric water heating bill. Same shower stall, just two different sources of hot water. Plus, no matter how long the grid might be down, I can at least get showers on sunny days, which is often enough for all practical purposes.

        I also have a homemade composting toilet that needs no running water at all, and the parts cost me only three dollars. There are no moving parts, so there is nothing to break – ever. No plumbing also means that there are no pipes to freeze in winter.

        I also have no car, although I do have a valid license. I do most of my local trips on my bicycle, and for longer trips, which are rare, I either take mass transit of some kind, or rent a car for the day.

        I could go on with some other examples, but these are probably enough to illustrate my overall point, which is that I am an aggressive minimalist.

        Lots of people feel that they cannot possibly do without every modern convenience, but I make a game out of this sort of thing, which compensates for the occasional bit of inconvenience.

        I also live comfortably on just $500 dollars a month, and my carbon footprint is about a tenth of the average for Americans. I was effectively retired long before I hit formal retirement age, because I only needed to work a few hours a week to cover my expenses.

        So, the stuff that looks like I must be a little deprived is actually how I achieve rock-solid financial security and also do my bit to push back aggressively against climate change.

        Again, my budget is just $500 a month, and I am missing little or nothing in the way of material comforts.

        In short, I am nearly always way outside the square, with respect to nearly everything I do.

        So, if any of that sounds useful, be my guest. I have no patent on any of it.

        • Miles Harding 5 years ago

          An ABC reporter once described the future as being like a foreign land: they do things differently there.
          I fully expect that we will become responsive to the local environment sometime soon. This may include simply doing nothing or switching to activities that require little energy input on those runs of calm cloudy days.

          • Motorshack 5 years ago

            Yes, exactly. The local environment, with the operative word here being local. I would also add the qualification “physical”, as opposed to the abstract political and economic world that our minds usually inhabit. A world that is rather easily manipulated by clever advertising of all kinds.

            Most people today seem to have literally forgotten how to tell the difference between a genuine physical need, such as food, and the rather abstract and arbitrary pseudo-needs created by corporate advertising.

            For example, sleeping in a reasonably warm, dry bed at night is pretty much a real need, but spending thousands on an elaborate fossil-fuel-based heating system is mostly a pseudo-need.

            A “modern” furnace does keep a dwelling, including the bed, warm, but it is also extremely complicated, prone to breakdown, a grossly inefficient use of resources, viciously expensive, and a danger to the very planet on which we live.

            In contrast, just adding a couple of extra blankets to the bedding in the winter accomplishes the same thing, at a tiny fraction of the cost and complexity. Plus, how often does a blanket break down? Short answer: never.

            Finally, if you are unhappy about the policies of the One Percent and their pet politicians, my approach is the perfect way to push back. Their whole game depends upon millions of witless customers, forking over their cash without thinking about it much. So, if lots of people woke up and stopped doing that, the rich could do nothing about it.

            So, no need for a bloody revolution. Just stop doing so effing much shopping.

            And, in any case, even if only a few do that, and the One Percent never notice, you can still keep most of your money in your own pocket, where it belongs.

          • CM 5 years ago

            But Motorshack, a nice warm bed using an electric blanket is a comfort of life – don’t worry it’s turned off upon entry under the blankets 🙂

          • Motorshack 5 years ago

            Cute.

            But, joking aside, you’re still heading in the right direction conceptually. It’s a lot more efficient to preheat just the bed, with a cheap, simple electric blanket, than it is to heat every cubic foot of a whole house, night and day, all winter long.

            My neighbors heat whole houses, 24/7, and it costs them about $4K each winter. I heat one room, and only when I am both home and awake, so my heating bill last winter was about $180.

            The $3,800 difference is enough to fund almost two thirds of my entire annual budget.

            I should also say that my ability to camp outdoors in winter does not mean that my living quarters are normally at unusual temperatures. I do have heated quarters, at 20C or better, all winter long.

            My point is rather that because I do have such skills, I have a much broader set of ideas about how to arrange comfortable living quarters, so I am not stuck automatically buying whatever big corporations think it would be profitable to sell me.

            Once you get out of that trap, it is simply amazing how well you can live on quite small sums of money. I have all the modern comforts – warm winter quarters, cooked food, hot showers, Internet connection, excellent health care, and much more – but I think hard about how to get those things as cost-effectively as possible.

            Nor do I cheat, by the way. Mostly I just do not buy things that are of no real use to me, which is nearly everything on offer.

            From my point of view most people have no more real sense about their money than does an unconscious drunk being rolled for his wallet in the gutter. It is pathetic to watch, and completely unnecessary.

            It would be one thing if people were being robbed at gunpoint, but they’re not.

            To the contrary, they are often begging big companies to take enormous sums of money from them. That is what happens every time someone borrows from a bank. First they beg in totally abject fashion, and then the bank “generously” agrees to accept thousands in interest payments for years to come.

            I could rant at far greater length on this point, but I will stop here. It’s getting pointless.

            Most people seem hellbent on giving away most of their income, for almost nothing in return, and I simply do not understand the attitude.

          • CM 5 years ago

            Thanks Motorshack – now if we could just convince the younger generation that perhaps a warm jumper in a moderately heated house (and shut the &^(& door/window), we might get somewhere. Sounds like you enjoy life and its simple pleasures.

          • Motorshack 5 years ago

            You’re welcome, although, frankly, I’m just trying to explain something I find obvious without descending into random insults.

            My material pleasures are indeed quite simple as a rule, while my intellectual pleasures are not.

            I spent 27 years doing complex, high-pressure software design projects, and mostly found that interesting, although towards the end I was getting a little burned out from the tight deadlines and limited budgets. A lot of my contracts were “turn-around” projects in which we were called in to salvage something where time and money were already half gone, and the product was a mess. Interesting, to be sure, but often rather tense work, as well.

            In retirement I am working up to a second, part-time career as a technical translator. So, aside from following the climate news very closely nearly every day, I have spent a good chunk of most days for the last four years wallowing in the fine points of Spanish. Another year and I hope to be ready to enter the job market again, but without any pressing need for the money.

            In any case, there are now twenty Spanish-speaking countries where I could chat with the locals quite comfortably on quite a range of topics, which I find a very interesting prospect all by itself.

            Finally, I had some luck with respect to my own children. Their mother has an MBA in finance, and is a self-made millionaire, so the boys had her example on how to accumulate lots of cash, and mine on how to manage comfortably with almost none at all. The fact that she and I were divorced twenty years ago seems not to have prevented them from taking good advantage of both our approaches.

            They also seem to take the climate issue very seriously, which is good, because their generation will suffer from it far more than mine will. One of them is about to graduate with a degree in marine biology, so presumably he will be up to his very eyeballs in the problem.

            And now I am definitely rambling.

          • Miles Harding 5 years ago

            Quote Motorshack:
            Most people today seem to have literally forgotten how to tell the difference between a genuine physical need, such as food, and the rather abstract and arbitrary pseudo-needs created by corporate advertising.
            Endquote
            Well, yes! Its called consumerism, I think. The whole idea is to consume more each year. There are many of us watching as this exponential growth becomes aspirational.

            So far there is little evidence that civic and financial systems are at all close to coping with the prospect of zero growth, let alone negative.

          • Motorshack 5 years ago

            I agree. However, we are rapidly running out of resources to exploit, so we will all need to learn to cope at some point in time, whether we want to or not.

            That is precisely why my own lifestyle is already heavily adapted to the conditions that will likely hit us full force one of these days, and probably sooner than most people would expect.

            I would like to be wrong about my expectations – indeed, really wrong – but unfortunately I see no evidence that I am, so I plan accordingly.

            If others choose to believe differently, that is their privilege.

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