The head of the Australian Energy Market Operator has declared that there is “no going back” to an electricity system based around “baseload and peaking” power, as Australia’s grid surges towards high levels of renewables.
“So the paradigm shift underway in our power system is from the economics of baseload and peaking, to renewables and firming,” AEMO chief executive Daniel Westerman said in an address to a CEDA event in Melbourne on Thursday.
“And there is no going back.”
Westerman’s comments should not be controversial, given the change in technology costs and options, and the country’s ageing coal fleet. The head of all the major energy utilities in Australia agree that the grid must move beyond the age of baseload.
But his comments do come just two days before the federal polling day and in the midst of an election campaign where the energy debate has pitched a future of renewables and storage from Labor (and the Greens and Teals) against that of the nuclear, coal and gas baseload grid pitched by the federal Coalition.
AEMO has argued, since the release of the very first editions of the Integrated System Plan – under the then Coalition government – that renewables and storage offer the lowest cost and most reliable replacement for the country’s ageing coal fired power stations.
Its modelling and planning blueprint were largely ignored by the Coalition government, and since it sat on the Opposition benches it has used AEMO as something of a punching bag in its push for nuclear and baseload. But Labor has adopted the blueprint and used it as a basis for its renewable and climate targets.
When Westerman took up his job around four years ago, he flagged that the grid had to be made ready to accommodate – by 2025 – the potential of 100 per cent renewables at certain times of the day, particularly given the huge uptake of rooftop solar.
Those occasions of “potential” 100 per cent renewables (in terms of output meeting customer demand) arrived early – in August last year – and have occurred on multiple occasions since. But the highest ever penetration of renewables on the grid remains at 75.6 per cent, reached (or should we say allowed) in November last year.
Westerman says the gap between potential and actual renewable penetration is explained by three factors – the decision by renewable generators to curtail their output because of low or negative prices, congestion on transmission lines, and the need to keep the grid stable and secure.
It was this last point that was the most critical, and presented the biggest engineering challenge.
“In addition to having enough energy to meet demand at any point in time, our power systems also need to be resilient against the disturbances that are a regular occurrence,” Westerman told Ceda.
“A large part of this resilience is provided by large spinning machines connected to the power system, most rotating at 50 times a second, providing the grid with the stable heartbeat that it needs.
“They don’t need to be burning fuel, they just need to be spinning. When the baseload coal-fired power stations retire, this stable heartbeat will need to be provided by synchronous condensers, or gas and hydro power stations fitted with a clutch that enables the generator to spin without burning fuel.
“Until enough of these non-generating options exist, our control room will need to direct existing generators to synchronise to make sure our grid is resilient.”
That means, Westerman says, that enough spinning machines – AEMO’s engineering map has concluded that the equivalent of 22 are required – must be operating in the background in a high renewables grid.
“This could be provided by synchronous condensers, service contracts with existing units, retrofitting of retiring generators, or by new gas turbines fitted with a clutch so the generator can spin freely,” he said.
“These machines are needed by the time the existing coal fleet retires. If commissioned as flexible gas generators with a clutch, they could also provide valuable insurance for reliability as the fleet of coal-fired power stations gets older.”
Westerman says new gas turbines will be required, even if they just spin freely “to keep the main power grid secure and resilient without burning fuel.
“So while they may only burn fuel 5% of the time, they can help keep our grid stable 100% of the time,” he said.
Given that Labor is favourite to be returned to government this weekend, the issue over the future of “baseload” may not be so controversial, given that coal fired power stations must retire, nuclear will no longer be on the table, and the baseload gas scenario preferred by the Coalition is a daft and expensive idea.
However, AEMO’s assessment of the grid security needs will surely spark ongoing debate within the industry, and amongst engineers and technology providers about the best course of action.
Westerman’s comments about the need for spinning machines to provide grid security made no mention of grid forming inverters, often touted as a modern, modular and cheaper solution.
But despite the urgings of the likes of Tesla, Fluence and others, AEMO is yet to be fully convinced, despite the numerous trials that have been funded around the country.
That much is evidenced by the latest update of its engineering roadmap, which raises questions about the ability of grid forming battery inverters to reliably replace high fault currents offered by spinning machines.
Managing fault current is a relatively obscure but crucial part of ensuring sufficient system strength in the grid to prevent the sort of cascading failures and equipment damage witnessed in Spain this week.
AEMO’s view is that only spinning machines – be they repurposed coal turbines, gas turbines that burn no fuel, or synchronous condensers – have proven viable for this purpose.
No doubt the battery makers – and battery project developers – will be pressing them to reconsider. And they will argue – quite strongly – that the transition should not try and replicate the past but should instead replace it with new alternatives, and that batteries can be installed a lot quicker than either new gas turbines or syncons.
AEMO says it is working through these issues in consultation with the industry as part of its engineering roadmap.
“AEMO is actively monitoring the performance of the existing GFM projects through available high resolution monitoring systems to improve the understanding of this technology,” it said in its 2024 document.
But also noted: Currently in the NEM, minimum levels of system strength must be provided by protection quality fault current, which GFM inverters have not yet demonstrated capability to provide.”
