Rooftop solar curtailment “lesser of two evils”, but no moratorium on new installs, says SA energy minister

South Australia’s energy minister has re-assured his state’s rooftop solar installers that the government won’t move to stop rooftop solar installations, but warned that action to curtail output to prevent a ‘negative demand’ scenario may be necessary.

Speaking to an energy ministers webinar organised by the Smart Energy Council, South Australian energy minister Dan van Holst Pellekaan said that the emerging challenge of negative net demand in South Australia, due to the high output from rooftop solar systems, represented a technical challenge that would require some level of intervention.

“If the grid reaches net negative demand, which the current operation is forecast in South Australia only a few years away. That’s not a political issue. That’s not a market issue. It’s not an environmental issue. It’s actually a physics and engineering issue to the grid,” van Holst Pellekaan said.

Estimates put rooftop solar penetration in South Australia at more than one-third of households, which can lead to situations were almost all of South Australia’s power is being sourced distributed solar systems that are not controllable by system operators. With uptake continuing to grow, it raises the genuine prospect that on some very sunny days, that more power is needed may come from rooftop solar.

Forecasts from the Australian Energy Market Operator suggest that South Australia could begin experiencing ‘negative demand’ periods as early as 2023.

The South Australian energy minister said that any moves to prevent households having solar installed on their homes would be an absolute last resort option, and that curtailment, where a limit is placed on the amount of solar power being exported, would be the “lesser of two evils.”

“We’re trying to do a lot of things rather than put a moratorium on new rooftop solar. We do not want to that. But we will have to curtail feed-in to the grid at certain times.”

“Nobody wants to be doing that. I don’t believe there’s going to be significant financial impact on homes. But it is necessary to do that. Because if we don’t do that, we will risk that net negative demand. And the only other way to avoid that at the moment would be to put a put a stop on new solar installations,” van Holst Pellekaan said.

Instead, the South Australian government will look for ways to manage rooftop solar output, that allows households to continue to have solar systems installed, without compromising the stability of the electricity system.

“We are under pressure and we’re doing the things we’re doing for many reasons, including not wanting a complete lockdown of the solar industry. We have no intention of that happening,” van Holst Pellekaan said.

“But we will have to impose some curtailment, a few times a year for a few hours at a time, so that we don’t have to lock down solar industry.”

An example of these measures has been the South Australia government’s support for battery storage systems, with the number of small battery installations nearing 13,000 in the state, which will allow excess solar to be stored and used at other periods during the day.

“One of the best ways for household to not be curtailed with their feed-in would be to have a battery and put this surplus electricity in their own battery instead, and then use that electricity in the evening, rather than out of a grid.”

The Australian Energy Market Commission is currently considering a number of energy market rule change proposals, including proposals that have won the backing of South Australian network operator SA Power Networks, as well as a rule change lodged by SA Power Networks themselves, that would incentivise sufficient and efficient investment in new network infrastructure, to allow households to continue exporting power to the grid.

The proposals would look to distribute the costs of the added network infrastructure fairly between energy users, and variations have been proposed by community groups, including the Total Environment Centre and the Australian Council of Social Services.