Stunning four-fold increase in big rooftop arrays as business stampedes to solar

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Clean Energy Regulator sees industrial and commercial solar adding a combined 100MW-plus to grid in 2018, as it sets off on a “j-shaped” growth curve.

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Australia’s booming commercial and industrial solar market could deliver a large-scale power plant’s worth of new renewable generation capacity to the grid in 2018, the head of the Clean Energy Regulator has projected.

Speaking at the Smart Energy Conference in Sydney on Tuesday, CER executive general manager, Mark Williamson, said a boom in solar installations of between 100kW and 1MW was well underway, and could deliver more than 100MW of cumulative capacity this year.

That astounding growth – illustrated by the “j-shaped” curve in the chart above – shows a market that has soared from a total of around 10MW just two years ago, to “who knows where” by the end of 2018, as more and more businesses embrace solar as a way to hedge soaring energy costs.

“Two years ago … I said that (the C&I solar sector) was a great business opportunity… and that it could be putting on, cumulatively, a large-scale renewable power station every year,” he told the conference.

“This year we’re going to see this happen for the first time, and this will make a difference to liquidity.

“It’s really taking off in a j-shape. Already … the capacity in applications for commercial and industrial sized systems between 100kW and 1MW … is going to smash last year,” Williamson said.

“But at this stage it’s looking like it could very well go well over 100MW cumulative capacity this year, and probably about 500 applications.

“(And) by the shape of this chart, who knows where this might finish up this year – it may go well beyond that; and where it might land next year.

“So I think this might provide more LGC liquidity that no one is factoring in,” he said.

“Everyone is underestimating the pace of what’s happening in the large-scale renewable energy pipeline, and the liquidity in LGCs moving forward.”

Sophie Vorrath

Sophie is editor of OneStepOffTheGrid.com.au and deputy editor of its sister site, RenewEconomy.com.au. Sophie has been writing about clean energy for more than a decade.

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48 Comments
  1. Craig Allen 8 months ago

    That’s not a j-curve. It’s a hokey stick.

  2. George Darroch 8 months ago

    That’s massive. If it’s 100MW this year you would expect at least as much next year, as the large commercial sector grows and prices presumably come down further.

    At what point does this start to put downward pressure on the retailers?

    • palmz 8 months ago

      Depends on how fast old generators retire (supply and demand sadly) We will be needing dispatchability very soon to avoid regular sharp peaks the openNEM graph was showing some recently close to sun set. (its stopped working on my computer)

      We only need a hour or two of high prices to keep average spot prices high. 🙁

      • My_Oath 8 months ago

        Its stopped working on my computer too. I thought it was just me…. Can someone let Giles know? My net access is quite sporadic at the moment as I am on the road.

        • palmz 8 months ago

          working again 🙂

  3. Chris Drongers 8 months ago

    Big takeoff of commercial solar will be when peer-to-peer trading is implemented; my warehouse roof to next door’s panel beaters paint baking oven. Look at the seas of warehouse roofs around airports and rail freight terminals.

    • Barri Mundee 8 months ago

      There seems to be huge scope to install solar on the roofs of outer Melbourne’s industrial heartland- factories, warehouses, workshops etc.
      No doubt this would be the case all over OZ.

    • Alastair Leith 8 months ago

      Tipping point seems to be imminent.

  4. Ian 8 months ago

    A sudden jump in commercial solar. Why? Initially I thought these people had favourable tariffs but look at an example from energy Australia of their small business tariffs :

    https://www.energyaustralia.com.au/business/electricity-and-gas/small-business/plans

    That’s very funny. Up to $1.99 fixed charge nearly 36c/kWh peak elect charges.

    I would expect 1MW a month commercial installations with those dumb tariffs!

    • trackdaze 8 months ago

      Correct me if im wrong but if systems >100kws are expected to equal 100Mw thats less than 1000 instals for the year.

      Like you say should be many times that.

  5. PacoBella 8 months ago

    A big new Bunnings opened near us a week or so ago. As the stores are all clones from the same design, can somebody please calculate how much electricity a standard store could generate if fitted with PV panels (none are, to the best of my knowledge). We could then calculate how many Liddell Power Stations Bunnings could contribute if it got off its lazy arse and joined the RE revolution. 167 of its 280 stores are in the “big box” format. The big box format is reportedly about 8,000 m2.

    • phillyc 8 months ago

      Hi efficiency panels are 20% efficiency. So 200W/m2. 8000m2 could be 1600kW / 1.6MW But since they’d be tilt mounted each string of panels would need to be spaced. Still 1000kW / 1.0MW should be entirely doable. So, Bunnings could do probably 280MW themselves. NB All back of the envelope calcs.

      • Gregory J. OLSEN Esq 8 months ago

        Must have a rather large envelope there, phillyc. 😉

      • Ian 8 months ago

        Nice work. 100kW is the limit for STC. So let’s take a mini-Bunnings. Origin energy’s tariff for this business in Queensland would be $1.33 exGSTdaily charge plus 27.63c/kWh exGST. FiT for <30kW 17c/kWh up to about 14kWh a day then 7c/kWh
        https://www.originenergy.com.au/content/dam/origin/business/Documents/energy-price-fact-sheets/qld/1July2017/QLD_Electricity_Small%20Business_Energex_BusinessSolarBoost3.PDF
        Installation cost $1.2/W roughly. Average solar generation say 4kWh/day/1kW nameplate.

        Cost to install 100kW : $120 000
        Electricity bill saved using all the solar out put : 400 x 365 x .2763 = $40300per year.
        Years to free elec : 3 years.

        How about paint shop Pete : puts up 16.6 kW system on his shop
        Cost to install: $20000 (tax write off: instantaneous) (@30% tax saved $6000)
        Electricity bill saved per year 16.6 x 4 x 365 x .2763 = $6700
        Years to free elec including the initial tax saved: 1.6 years.

        • Ian 8 months ago

          Take a business which has a constant power drain of 10 kW. Solar is generated in a bell curve so that from 11am to 2pm more than 85% nameplate power is generated and outside that period less is generated.

          Roughly speaking for 20% more solar installed than power requirements in kW might gain you 10% more electricity kWh and about the same clipped and lost or available for export/batteries.

          12kW system 10 x 4 x 365 x 0.1 = ie 1460kWh exported 1460 x 17c =$250/year and $1460 x .2763 = $400/year saved

          The extra 2kW would cost $2400 and the savings and earnings about $650 a year, 4 years payback. Still worth over-clocking a solar install by 20%.

        • Adrian 8 months ago

          Sorry – Bunnings pays nothing like those costs for power. They effectively pay wholesale plus tiny margin for the electricity, plus a demand charge. Problems is the demand charge basicaly doesn’t reduce with solar because it is calculated on the maximum over a 12 month period – and there is always a cloudy day that means the solar output is low. So, Bunnings return from solar will probably run at or just below 10% per annum. So when you factor in a required return in capital, there are probably a list of 100 other areas where Bunnings could spend that money and generate a better return. It is why large businesses really don’t do solar (and economically they shouldn’t).

          And unfortunately, Paint Shop Pete also doesn’t get those kind of returns and probably uses a chunk of power outside of solar production hours. His system probably also produces more at peak times than he needs, so he is exporting and getting a terrible return.

          Pete and Bunnings should both do LEDs first and not install solar at all (if they are paying the capex). Better to not use the electricity at all.

          Both Pete and Bunnings should however look at PPAs as they get an instant saving and incur no capital outlay, so get a fantastic return on their nil investment.

          • palmz 8 months ago

            Not a fan of PPA’s but leasing a system with a buy out figure works to. (we have done this, cash flow +)

            I agree demand charges will kill the returns if you have them… The savings come from not paying charges per KwH (network, energy, environmental)

          • Ian 8 months ago

            Looking at demand type tariffs in the 30 to 120kW range , offered by Ergon energy. These are not particularly competitive vs the usual general tariff. Tariff 44 demand $41.539, all usage 16.27c/kWh, connection $54.63. If a business had a demand peak of 30 kW and used 300 kW a day the cost would be ((30 x 41.539) + 300 x 30 x 0.1627 + 54.63×30)/30 =$145/day cost per kWh 145/300 = 48c/kWh not particularly good now is it. Even a business using a constant power input the cost would be 30c/kWh. Rooftop solar plus general tariffs runs rings around this.

    • Ren Stimpy 8 months ago

      In a few years’ time Bunnings will be selling solar panels off the shelf for less than $1000 per 5MW in a cardboard wrapped pack.

    • palmz 8 months ago

      Couple of things unless the roof was designed to have additional load put on it, may not have sufficient strength to have a large solar system out on it.

      Current infrastructure on the roof may cause shading making different parts of the roof unsuited for solar.

      Also they will most likely require approval for a large solar system, and they may be forced to comply with having the system limited on how much it can feed in to the grid.

      • john 8 months ago

        Solar panels are 23 kilos per square meter way less than a man or lady walking on the roof.
        Yes the operator of the grid will limit its output for instance a recent installation was limited to 3.2 kw per phase.

        • trackdaze 8 months ago

          Additional wind loading just as much a factor.

          • john 8 months ago

            As the roof is designed for unless it is built to some flunk cat 3 cat.

        • palmz 8 months ago

          yes but when looking at 100’s KW your talking tonnes I am not talking about the individual panels. you dont have a couple of hundred people walking around on a warehouse roof do you.

          JKM260PP-60 19KG watts 260
          100,000watts over 260= 384.6 *19kg =7,307KG this excludes all other equipment needed to make them work. (wires mounting stuff other)

          some commercial roofs will be made as light roofs to save costs so they will not in that case be able to have a large solar array put on them.

          http://www.afr.com/real-estate/slender-roofs-wont-bear-a-solar-future-20180329-h0y3vg

          https://www.solarquotes.com.au/blog/commercial-solar-power-tips/

          • Ian 8 months ago

            Just home much pressure do these panels put on the roof surface? 1atmosphere is 14.7 psi trina’s domestic panel is about 1.6m x 1m and weighs 23.5kg this is 0.02psi force. A very light puff of air!

          • palmz 8 months ago

            Once again I am talking about the roof as a whole. A commercial building will be built to specks if they only just meet them to keep costs down.

            They may not allow a large extra dead load to be added, and still meet specks.

            They need to be designed to handle a 1 in 100 year rain fall event I think many building don’t use I beems as pearlings.

            And obviously the building needs to be designed to have a roof. I cannot figure out why you bought this up.

            So a couple of people pretty much said you can fit a mW or more on these roofs.

            I am just trying to show that you cannot just call up a solar installer and say I want you to install a mW on my roof before next month.

            Their is no point putting 300kW on a roof if you are only allowed to feed in 30kW and you max usage is 50kW. (Some may not even be allowed to feed any in)

          • Ian 8 months ago

            I brought this up simply to question the validity of your assertion that commercial buildings are so weak that they cannot take the gossamer light solar panels. Quite obviously each company needs to get the engineering done to ensure they have a safe installation. As you say many may not need to fully cover their roof when their requirements are much less than the roof space available to them.

          • palmz 8 months ago

            Sorry that was not my intention.

            My intention was just to show that commercial installs have some extra hurdles that need to be satisfied. Mainly ones that a domestic customer would not normally see/ deal with.

            I just want people to think before saying that warehouse roof should be covered with solar, without thinking if there is a real reason why it is not. (I can’t see why most could not have some solar on them but it will be about the scale that is suitable be it 30kW or 3mW)

      • handbaskets'r'us 8 months ago

        Most commercial buildings are ideal for solar, -like Bunnings. Big, flat, unshaded roofs. Roofs for miles.

    • David Osmond 8 months ago

      Assuming the entire roof is covered with horizontal flush mounted panels, then you could fit about 1.2 MW of PV. In Sydney, this system would generate about 1,500 MWh per year

    • trackdaze 8 months ago

      1kw of energy per square metre is the solar potential. So thats 8MW
      Conversion efficiency of a panels is ~ 20% so thats 1.6MW.

      This assumes they have been smart enough to engineer the roofs to accept the addional weight and increased wind loads. Or havent signed into long term supply contracts at <10cents a kw.

    • Alastair Leith 8 months ago

      So many EE consultants have tried to tell Bunnings this, I’m sure of it.

    • My_Oath 8 months ago

      Bunnings is owned by Wesfarmers. Guess how many coal mines Wesfarmers owns. Rather than being lazy, the reticence is more about self-interest.

  6. Kevin Brown 8 months ago

    My local shopping centre in the suburb of Stafford in Brisbane has a huge North facing parking area with covered parking that could easily be converted into a PV farm and used to power the shopping centre which needs heaps of power to run its air-con and refrigeration during midday hours. What’s the hold up?

    • john 8 months ago

      Simple they are too stupid to know or too lazy use both it fits.

    • Alastair Leith 8 months ago

      “John, or Pete our accountant has looked at it already and he says it’s not commercial yet”

    • My_Oath 8 months ago

      Quite often, the supermarket doesn’t own the car parks – often, they don’t even own the building so they can’t even put solar on the roof.

  7. Ant.. 8 months ago

    There is a huge business opportunity for negatively geared property where the owner squeezes themselves between the tenant and the energy supplier and sells the power generated by the solar panels to the tenant for an agreed cost per kWh or the same value as the FIT. If you do the sums on FIT at 0.10102c per kWh [4kWh/kW] at worst the gross ROI on a $7,000 5 kW system is about 8.00% pa. In FNQ you can have domestic systems up to 10 kW single phase and 30 kW systems three phase all in the moment throttled at 5 kW. If you also install a battery depending on location you can become a supplier of dispatchable power which has different pricing over and above and in addition to FIT. Deposit Power call them GridCredits. https://repositpower.com/products/

    • Mike Shackleton 8 months ago

      The system you are after is provided by a company called Matter Solar. As a landlord you can sell the power your rooftop panels generate to your tenant for a rate equal to or less than their energy company’s standing offer. Any excess that is exported to the grid gets the relevant FiT. The idea is to charge your tenant less for solar power from the panels, but more than the FiT, so they preferentially consume solar power. They save money, you generate income. Win-win.

      • Ant.. 8 months ago

        Yes there is however a risk for the owner and that is who is legally bound to pay the electricity bill and how the arrangement is contracted so that the cash flow benefit is credited to the owner and who’s solar records are to be relied upon and can they be independently audited. Energy suppliers account for FIT but not for Solar Generated and Consumed.

        • Alastair Leith 8 months ago

          If you can’t trust your tenants to pay the bill, how can you trust them to pay the rent?

          • Ant.. 8 months ago

            As a Senior Manager for an NBFI I used to write credit policy and update it so as to match the there and then market conditions. Interesting enough I had a arrangement with the University of Melbourne who used to on a monthly basis calculate poverty line figures for the Government for all classes of family units [Single no Dependants, Married no Dependents, Single with one Dependant that sort of thing. Our capacity to pay assessment was firmly based in a formula based on capacity to pay with the poverty line as a bench mark. There is significant criticism if you commit a person beyond their financial means including the commitment to pay rent. Now it just so happens that there are four categories when it comes to a capacity to pay assessment and that is based on their credit history, savings record, asset accumulation, net worth identify with reasonable accuracy. 1] those willing and able to pay, 2] those willing but unable to pay 3], Those able but unwilling to pay and 4] those unwilling and unable to pay. 25 years of experience has taught me this. If it came to trust why then do tenants have to pay a bond. You have a lot to learn?

          • Alastair Leith 8 months ago

            “If it came to trust why then do tenants have to pay a bond.”

            That was rather my point. There’s ways and means.

          • Ant.. 8 months ago

            In FNQ [Ergon] retail pricing is regulated. What is being speculated for the tariff period 1 July 2018 – June 2019 that there will be a decrease to the General Tariff and that the same formula used in calculating FIT in the current period will be applied to the next period.

  8. handbaskets'r'us 8 months ago

    Driving South, down the freeway in Perth, one can’t help noticing the in-fill of solar on residences and factories. It’s been about 6 months since my last look, and the uptake is dramatic. Furthermore, towns Like Waroona are a sea of blue. Clearly, the word is getting around!

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