WA govt considers home battery incentives, in solar tariff review

Print Friendly, PDF & Email

WA energy minister flags review of state’s solar tariffs, and possible incentives to boost battery uptake, as the rooftop PV market continues to boom.

share
Print Friendly, PDF & Email

One Step Off The Grid

The Western Australia government is reportedly mulling the introduction of home battery storage incentives, as the state works to manage a rate of rooftop solar uptake that is expected to grow three-fold in the next decade.

The West Australian reported on Tuesday that energy minister Ben Wyatt was looking at ways to boost battery uptake, alongside possible changes to the state’s rooftop solar tariffs, that would either wind them back or scrap them altogether.

The news, which the West has packaged as a potential hit on state solar subsidies, is being interpreted elsewhere as a good thing, both for solar and battery storage in the state.

According to Redback Energy managing director Brian Innes, it could even provide hundreds of dollars a year of revenue for homes with solar and battery storage.

“Some good practical thinking coming from our Energy Minister,” Innes said on LinkedIn. We can reduce REBS payments to the daytime price and add a NWC payment (Notional Wholesale Capacity) for battery owners which could work out around $600/yr for a 5kva/10kwh VPP enabled system.”

Wyatt says batteries will have a crucial role in WA’s future energy needs by “helping maximise the use of existing infrastructure and reducing the cost of electricity supply for consumers” – a view shared by the Australian Energy Market Operator and most of the nation’s network operators.

On solar, The West Australian reports that Wyatt said Synergy was paying “over the odds” for surplus solar power during the middle of the day, when demand for electricity was typically low and output from Perth’s 240,000 solar homes was high.

He said he had asked the Public Utilities Office to examine the buyback scheme along with the adequacy of incentives for solar panels and batteries.

“The current REBS buyback rate is currently higher than the value of solar energy during the day. The scheme will be part of a more comprehensive examination of the State’s future electricity generation mix,” Wyatt said.

The paper draws a line between these comments and one of the more controversial findings from the recent Australian Competition and Consumer Commission electricity price review, that recommended winding up the federal government’s small-scale solar scheme early, or even closing it immediately.

That scheme, which marginally reduces the total up-front cost of installing solar, is being wound back already, and is completely separate to the state mandated rates that solar households are paid for the energy they export to the grid.

As it stands in WA, rooftop solar homes in Perth and the south-west region of the state receive a solar feed-in tariff from government-owned Synergy of 7.135c/kWh under the Renewable Energy Buyback Scheme (REBS).

But those in regional areas of WA, on the Horizon Power network, can get between 7.14c/kWh and 51c/kWh, depending on their location and system size.

And those in the state who applied for rooftop solar panels in the 201/11 financial year gained access to a 40c/kWh feed-in tariff for 10 years, or 20c/kWh for 10 years if they installed in July 2011.

Seven years later, as UWA Professor and solar industry expert Ray Wills noted in a Tweet (below), it is probably high time for a review of solar tariffs – as long as it is “transparent” and takes into account all of the benefits that rooftop solar offers to the broader grid.

But Wyatt’s review is, no doubt, also motivated by the head-spinning pace of solar growth in WA, and a need to start boosting the momentum of home battery storage uptake.

As we reported here, the Australian Energy Market Operator expects 134MW of rooftop solar to be installed annually over the next 10 years in WA, resulting in 2,273MW of total installed rooftop PV by 2027-28 – compared to 826MW at the end of December.

Battery storage uptake is expected to grow even more dramatically – AEMO forecasts a potential 10-fold increase in uptake – but that is off a very low base.

As Wills told One Step, as the state gets to rooftop solar penetration of 40-50 per cent in the early 2020s – it’s currently round the 30 per cent mark – significant deployment of battery storage will be needed.

Wills believes much of that battery growth will happen organically, but could easily be accelerated by well designed market incentives.

“I’m confident that, with a Labor government that has pledged to support renewables, they will not do anything to dud the rooftop solar market,” Wills said.

“As well as helping to better manage the impact of rooftop solar on the grid, batteries can help to shave peak loads and ultimately bring the state’s electricity prices down.”

This article was originally published on RenewEconomy’s sister site, One Step Off The Grid, which focuses on customer experience with distributed generation. To sign up to One Step’s free weekly newsletter, please click here.

Print Friendly, PDF & Email

11 Comments
  1. john 6 months ago

    Once there is a large penetration of solar with storage the duck head will be reduced which will lower prices for all consumers.
    It will not surprise to see all new build housing being mandated to have solar, storage and for that matter water storage.
    The mandating of solar would do away with the ridiculous situation where houses can be built in the exact opposite orientation to minimize thermal load.
    The result being little north facing roof space.
    I feel the battery storage must be of sufficient size to mitigate most if not all over night power requirements.
    As to installing battery storage to existing systems a plan could be worked out where some of the savings in wholesale costs could be passed on.

  2. Mike Westerman 6 months ago

    Hopefully air con thermal storage will be part of the mix, given the large proportion of air con load contributing to the duck curve.

    • Ian Porter 6 months ago

      Indeed. Ice Cub and Ice Bear, a fraction of the cost of Lithium batteries. Growing use in California for load shifting. Has same smoothing benefit to the grid as battery storage. Its not so useful in the lower half of Australian in winter however.

      • Mike Westerman 6 months ago

        No – for them hydronic heating system with reasonable storage tank.

        • Ian Porter 6 months ago

          Cost of hydronic heating in Aust is generally cost prohibitive.

          • Mike Westerman 6 months ago

            I’d think it is less than reverse cycle plus batteries – a friend is putting one in in S NSW and decided to go hydronic with storage plus a modest battery for everything else.

  3. Ian 6 months ago

    The STC’s have made a huge difference to the energy landscape in Australia, and now the time has come to use subsidies to promote the next stage in the energy evolution -batteries. Residential battery systems need to be subsidised so that they are affordable to the majority of households.

    Considering the midday peak of solar production may start to depress wholesale prices and that batteries might shift this production to a more convenient time, you could say that batteries would prevent unnecessarily depressed wholesale prices and are a direct benefit to utility scale generators.

    Networks would benefit from smoothing the peaks of demand and of distributed generation, their infrastructure must be designed to handle peaks rather than averages of electricity flow

    Behind the meter batteries are likely to reduce the morning and evening peak demand, this is of benefit to network operators, ie government. Less need for capacity payments to owners of peaking equipment.

    Numbers can be added to these factors and the actual monetary value calculated.

  4. My_Oath 6 months ago

    Interesting that Wills is calling or a review, but when questioned about the glaring errors in his “Lithium alley” report, he refused to address the issues raised.

    • Brett 6 months ago

      What errors? Do you have a links? I’m interested.

      • My_Oath 6 months ago

        For a start, there are references in some graphs to “LME” – “Lithium Metal Equivalent”. The industry standard is “LCE” – Lithium Carbonate Equivalent. Some do indeed show LCE, but there is no explanation for why sometimes LME is referenced.

        But the problem is what the LME graphs show: 16 times more consumption than even of the most bullish of market observers. When asked about the discrepancy, Wills “Stood by his team” and refused to even acknowledge the difference.

        Also, they list the operating lithium mines. At the time it was
        * Greenbushes
        *Mt Cattlin
        *Mt Marion
        *Wodgina

        and

        “All operating mines are producing spodumene concentrate”

        NO. Wodgina is Direct Shipping Ore. It is not concentrating the spodumene. This is a HUGE oversight.

        and

        In refference to the above mines they show pricing of in excess of $15,000/tonne for concentrate.

        NO. At the time of the report, pricing for concentrate was about $900/t. It is now about $1100. No one is getting $15,000+ /tonne. Its nonsense.

  5. Ian Porter 6 months ago

    The minister is quoted as conducting a review of the 7.1c REBS FiT and removal of the (Federal) STC subsidy on PV systems. He is also quoted as saying he was “looking at ways to boost the uptake of batteries to safeguard the grid from the effects of soaring levels of green power”. Unfortunately this is a suggestion that solar PV is a threat, rather than the inflexibility of aged coal derived generation. Batteries under such a statement have to be seen as a means to prop up existing coal-fired plants by decreasing grid impact of distributed energy resources such as that from solar PV. The problem is that the aged coal units require staged retirement planning, not the rollback of solar or the use of batteries alone to maintain the status quo. If the notion is to insist that batteries be installed with any future PV install, the RE rollout and an essential orderly transition will not eventuate and it will cripple the solar PV industry.

    It is to be hoped that the minister will consider all aspects including the aspirations of consumers, the need for increasing RE penetration to also enable the state to contribute it’s fair share to national climate treaty obligations before deciding on a policy. The WA electorate will most likely be very sensitive to any negative or adverse consequences for RE in the state.

Comments are closed.