Renewable Energy Down Under: Where solar-plus-storage and utilities become good friends?
In case you hadn’t heard, changes are afoot in our energy system. With previously preventative price points now falling rapidly, are we now seeing an opportunity for an accompanying change in the pricing of our energy?
As production ramps up, the energy storage systems required to firm intermittent renewable power are beginning to become financially viable. Smart inverters and corresponding software are combining with solar-plus-storage systems to enable truly democratized energy. To this point, customers in many geographies are already able to realize a triple-threat in pricing incentives: electricity price arbitrage through the storage of cheap energy for peak demand periods, selling excess energy via peer-to-peer trading, and selling energy back to the grid – often at a premium rate. These changes in energy sector dynamics are engendering an opportunity for innovative cleantech partnerships and new pricing structures. So, are we truly moving away from the bulk volumetric grid pricing systems of today, and if so, toward what? In this post, we will travel down-under to examine some of the innovative approaches to energy consumption and pricing that are being offered.
Despite recent rhetoric of climate-change denial, the Australian government is now a somewhat surprising champion of innovative approaches to renewable energy production and pricing. Although the Australian economy is still dependent on coal as a key source of energy, there has been a nation-wide push to find new energy solutions since the end of Tony Abbott’s government. In May this year, South Australia switched off the last of its coal-power generators, and Victoria’s coal reliance has dropped since the closure of the Hazelwood coal facility. To replace these traditional means of energy generation and grid stability, the Australian Renewable Energy Agency (ARENA) has run several trials of innovative energy approaches. With Australian start-up Reposit, ARENA is testing the use of smart inverter technology combined with solar-tied batteries such as Tesla’s Power Wall to find new ways of reducing consumer energy bills. Tesla’s PowerWall 2 has released in Australia in recent weeks, making headlines for its apparent price parity with grid energy (see chart below). Homegrown Australian alternatives to Tesla’s batteries are also appearing.
After a successful pilot project, Reposit’s GridCredits system is being offered to consumers as a commercial product throughout Australia. GridCredits uses data and intelligence from smart inverters to determine when solar generated from rooftop PVs should be consumed, when to store this energy in a battery, and when to sell it back to the grid at a premium price through the country’s feed-in tariff. Through the combination of world-leading rates of solar adoption, the high cost of energy from the Australian grid, and rapid advances in battery technology and smart grid monitoring, Australia has the opportunity to become a key player in driving the narrative of an alternative energy pricing system.
Aggressive feed-in tariff policies resulted in high levels of adoption of solar PV in places like Germany over the past two decades, but Australia has the opportunity to shape a new path with additional market-enabling tools like GridCredits. Another tool-bearer from the private sector is Geli, the Silicon Valley-based developer of a software platform to manage distributed solar-plus-storage assets. A recent funding round in July 2016 will be used to set up a regional hub in Australia, where Geli’s solutions can unlock cheaper ‘behind the grid’ consumer spending and potentially, over time, encourage utilities and regulators to adapt the ‘in front of the grid’ pricing mechanisms common in the developed world. There is reason to be hopeful of an Australian energy evolution as businesses capture some of the spoils of the oncoming solar-plus-storage boom. Things are looking up down-under.