South Australia offers vital lessons for other jurisdictions transitioning from a fossil fuel-based electricity grid to a low emissions, high penetration renewables grid.
Coal was phased out in 2016. Today, South Australia’s grid is dominated by wind and solar backed up by battery storage and interstate grid connectivity. Peaking gas is seen only as a temporary generation technology.
The proportion of electricity demand met by large-scale and small-scale variable renewable energy generation grew from zero to 60% in just 14 years.
South Australia’s 2020 electricity demand was served by 13% rooftop solar, 4% utility-scale solar and 42% wind. The remainder was provided by gas generators (42%), interstate imports and exports and a contribution from batteries.
With 40% of homes having rooftop solar, South Australia is a global leader.
But the records don’t stop there according to a new report by the Institute for Energy Economics and Financial Analysis (IEEFA) which highlights lessons learnt for energy planners globally.
South Australia has shown that 100% solar generation is possible during the daytime to meet users’ energy demands.
The state’s fast initial uptake of renewables was driven by strong wind and solar resources, and historically high residential and wholesale electricity prices.
Government policies like the national Renewable Energy Target and the South Australian rooftop solar feed-in tariff, and more recently the Home Battery Scheme, have also been significant in facilitating the transition to a renewables dominated grid.
Expecting to achieve its net 100% renewable energy target by 2025, five years ahead of schedule, the state is now aiming to reach 500% renewables by 2050.
South Australian plans to become a renewable energy superpower, exporting surplus renewable energy to other states and internationally through green hydrogen and other low emissions products.
This ambitious plan is driving new investment, jobs and economic growth in the state.
With the $2 billion interconnector between South Australia and New South Wales achieving final regulatory approval this week – the largest interconnector to date in the National Electricity Market – several gigawatts of renewable energy capacity is expected to be unlocked, along with more than 2600 jobs and annual net energy savings of $100 per South Australian household and $60 per New South Wales household.
The interconnector will unlock further energy supply demand balancing capability, benefitting both states. It will also effectively mitigate the risk of South Australia being disconnected from the rest of the National Electricity Market (NEM).
As the state continues to transition away from synchronous, fossil fuel-based generators to asynchronous, renewable energy, South Australia is taking steps to maintain security in this new grid archetype.
Batteries are a key technology solution here. An early adopter, South Australia installed the largest battery energy storage system in the world at the time of commissioning in 2017.
By responding quickly to fluctuations in the grid, the Hornsdale battery helps to maintain reliability and security and has been a financial and technical success, saving consumers $150 million in the first 2 years of operation.
The increasingly high penetration of rooftop solar is being managed with distribution network innovation including LV monitoring, transformer tap changes, and the development of dynamic operating envelopes (DOEs).
South Australia’s network operator is now managing 40% rooftop solar household penetration using less than 1% of its regulated network revenue.
Maintaining reliability in a renewables dominated grid is possible, with reliability standards continuing to be met since the transition to renewables began in force in 2007 (except for 2008/9 when there was an extreme heat event).
Furthermore, the increasing proportion of low-cost renewables in the grid keeps driving down electricity prices. Since 2017, wholesale prices in South Australia have dropped a whopping 65%.
Moving onwards to 500% renewables, South Australia will continue to set an example for other jurisdictions on how to manage large amounts of wind and solar in the grid.
This transition to a zero-emissions, zero-inertia electricity grid with a comprehensive demand response regime and optimisation of both large scale and distributed energy resources has yet to be achieved anywhere in the world.
South Australia has the potential to achieve it within a decade with thoughtful planning and policy.
South Australia provides 7 vital lessons for energy planners around the globe:
- Over 60% of annual demand can be provided by variable wind and solar and 100% in certain time periods
- Government policy and market features can drive high adoption of renewables
- Ambitious renewables plans can drive economic growth
- Wind and solar bring down wholesale electricity prices
- System reliability and security can be maintained in a high renewables grid
- Batteries (utility scale and behind the meter storage) can help maintain system reliability and security
- High penetrations of rooftop solar can be managed with distribution network innovation
Johanna Bowyer is an Australian electricity analyst with IEEFA and Dr Gabrielle Kuiper is a DER specialist.
