Australians are embracing a new way of doing things when it comes to energy, motivated by strengthening local communities, helping the environment and saving money. It’s a collaborative approach to energy that’s been happening at a community level for some time, but now the organisations that run the Australian energy market, like the Australian Energy Market Commission are working with all peak government and energy bodies, as well as industry and consumer groups, to support a new energy systems vision for the future. A future where people have control over how their solar panels, batteries, and other energy resources are used.
According to the 2020 Integrated System Plan developed by the Australian Energy Market Operator:
“Australia's energy ecosystem is rapidly transforming towards a decentralised, scalable two-way energy system, driven by Australia's world-leading uptake of household and commercial solar generation and energy storage capabilities.”
The AEMO highlights anticipated innovations in Distributed Energy Resources (DER) as part of its 2020 ISP and indicates that Australia could reach 75 per cent renewable energy by 2040 – if not sooner.
What does this all mean?
Don’t worry, it’s good news! It’s a new way of doing energy that generates, stores and shares energy between businesses and households without being tied to the static poles and wires that distribute coal-fired energy.
“The future is not centralised energy. Its dispatched, decentralised in different ways, connecting all sorts of energy forms to run our grids and our cars.” Damon Gameau, 2040 Director.
The energy comes from lots of renewable energy generation sources, like solar panels, wind farms, from roof top-sized to large-scale, plus other sources; and, it is coordinated through technologies that allow it to be shared and used (like peer-to-peer, or household-to-household trading).
Damon Gameau, Director, 2040, Giles Parkinson, Editor, Renew Economy and Belinda Kinkead, LO3 Director Australia, talk new energy systems based on distributed energy.
Internationally, in some less developed economies, communities are breaking away from centralised energy systems (that is systems reliant on burning coal and transmitting energy along long-distance power lines) by using new technologies that allow them to create their own mini-systems based on locally-distributed rooftop solar. Like the microgrid in Bangladesh discussed in the film 2040. Here’s another example, created in Brooklyn, New York, USA with partner LO3.
In the Australian context, regulatory barriers prevent a complete breakaway. Our system was built around the coal and gas industry, which has powered our homes for centuries. However, government policy, subsidies and partnerships are enabling new decentralised systems to be created
These partnerships involve an energy retailer, sometimes the state government, and companies that can provide the energy generation, sharing and storing technologies needed to support a decentralised, local energy system. The partnerships are making waves into breaking down the barriers that existed in the old system where energy flowed one way.
New partnership projects are already demonstrating improved financial, environmental and social impacts of decentralised, local systems. And it’s envisaged that eventually we’ll be increasingly powered by lots and lots of little local systems that are coordinated together, like in virtual power plants and microgrids, where everyone plays a part, and your energy will be renewable and local.
“It’s called the democratisation of energy. New technologies are coming in that are cheaper, smarter, better, quicker. But breaking down the barriers in an incredibly complex industry is hard and you can’t do it without government leadership.” Giles Parkinson, Editor Renew Economy.
Change is coming fast
It’s no secret that Australia’s transmission infrastructure needs a pretty big overhaul. The energy grid, as we know it, was originally designed to deliver centralised electricity generation from coal-fired power stations, which may have been fine way-back-when. But now we know the real price of burning coal for energy – our climate. New technologies are coming in that are carbon emissions-free; and they’re proving to be cheaper, cleaner, smarter, and quicker too.
In fact, the Australian energy grid hit a significant milestone in late 2019 when for ten minutes, 50% of energy was produced and sourced from renewables. Another recent report found:
"Rooftop solar systems and new large-scale farms regularly pushed renewable energy to beyond 30% of generation at midday during June (2019), one of the least sunny months."
There is a real momentum for change and it’s only going to keep building. The future of Australia’s energy supply is here, and it’s clean, localised, and renewable!
Why Australia’s energy infrastructure needs an overhaul
We need energy infrastructure that is agile, resilient and reliable, especially in the face of increasingly volatile weather. And we no longer need to rely on heavy-polluting, high-carbon emitting coal-fired power plants for our energy. In addition to being a cumbersome way to generate and transmit power, it’s expensive. In short, the current system we have just isn’t up to the job, whatever metric you use to measure it by.
Here’s an overview of what some of the key problems can look like in practice:
- Energy Networks Australia, the group which represents the poles and wires industry, has said power prices could increase due to constantly rising insurance costs as a result of the increased bushfire risk, and the damage to poles and wires from the recent fires. (Source: ABC News)
- In December and January, tens of thousands of people lost power because bushfires damaged electricity infrastructure in several states, with some fire-affected towns such as Mallacoota in Victoria's east cut off. (Source: ABC News)
- As of 2017, 75% of all coal-fired power stations were operating near or beyond their expected commercial lives, and it is these same ageing power stations that are responsible for a decent chunk of Australia’s greenhouse emissions.
- Demand for coal-fired electricity is falling and the demand for renewable energy is rising.
Enter: South Australia and its amazing transformation
We know a shift to clean, localised power works. Allow us to present South Australia, home of the world’s largest lithium-ion battery that was built, installed and operational in under 100 days. You may well remember the context in which it was built. South Australia was experiencing crippling energy problems and was heading into a future with little assurance of energy security. In fact, the state was in the middle of a state-wide blackout. There were also two very high-profile tech entrepreneurs involved in getting this battery delivered, which guaranteed the widespread coverage this battery and its success has had ever since.
The battery, alongside the state’s broader commitment to renewable energy, has well and truly proven itself. When severe storms hit South Australia on 31 January this year, high winds brought down one of the state’s biggest transmission lines. As a result, the South Australian grid separated from the rest of the Australian Energy Market and operated effectively as an ‘island’ for two weeks. This is a big deal, a world first, even.
South Australia continued to operate with an average of more than 50 per cent renewable energy for the two weeks it operated in this way, and it did so with a lower cost of power than coal-dominated NSW. The role played by South Australian wind farms and its three big batteries in keeping the lights on is a testament to the added grid security that comes with inverter-based technologies such as wind, solar and batteries, and all the coordinating software which supports them. This allows power generation to be reflexive and respond accordingly, which leads to increased energy security.
Since then the battery’s capacity has been increased with state government investment and the South Australian government has declared its plans to be powered by 100 per cent renewable energy within a decade. The South Australian government has proactively taken up distributed energy technologies to create a large virtual power plant pilot.
“Rather than having a 100megawatt or 200megawatt coal-fired or other generators, you have lots and lots of little systems. So, distributed energy resources like solar panels on peoples’ rooves that are aggregated or coordinated as the virtual power plant to make up the 100megawatts or 200 megawatts.” Belinda Kinkead, Director Australia, LO3.
The role of community energy: Microgrids, Solar Gardens and Shared Community Batteries with Enova
New partnerships and technologies are combining to help protect the grid, save money, combat the climate crisis and build community. By working with an ethical energy retailer like Enova as well as technology partners, communities can become energy independent.
Enova offers a new framework for how energy can be done differently. By flipping the traditional retail model, Enova is doing this via innovative projects like Microgrids, Solar Gardens and its first Shared Community Battery pilot project - with the intention of strengthening communities and providing secure, affordable renewable energy to everyone.
If you’d like to be involved with an energy company on the right side of energy history, consider Enova. We also welcome your enquiries to be part of our first shared community battery or to let us know of your community’s plans for a microgrid or solar garden. Please do get in touch to switch, or enquire about projects.