Re-engineering the grid: Nailing the magnitude of infrastructure required to support the energy transition
Andrew Mears speaking at Australian Energy Week 2023
Our CEO and founder Dr Andrew Mears spoke at Melbourne’s Australian Energy Week on re-engineering the grid and nailing the magnitude of infrastructure required to support the energy transition. Closely following AEMO CEO, Daniel Westerman’s address at the conference, Andrew questioned the AEMO’s lack of consideration for distributed energy resources (DER) in their 2022 Integrated System Plan (ISP).
During Westerman’s speech, he confirmed that large-scale renewables are not being built at a fast enough pace to meet the federal government’s 2030 targets. With this being said, Westerman pointed to the fact that rooftop solar continues to thrive and is equivalent to 25% of the grid’s generation capacity today.
“As you know, electricity supply and demand must be balanced at every point in time. An oversupply of generation, even from rooftop solar, would cause our electricity system to lose balance with dire consequences.”
To ensure efficient investment, policymakers need to think beyond transmission and consider the role of energy storage, software and distribution networks as a key part of infrastructure strategy.
We need to better understand how much of AEMO’s $12 Billion projected transmission spend could be deferred or avoided if there is more than anticipated uptake of rooftop solar, batteries and EVs. As well as how it would impact if rooftop solar, batteries and EVs are integrated into the distribution network, with flexible load and markets to encourage matching flexible load and variable generation.
Andrew references an approach supported in modelling undertaken by ITP Renewables and commissioned and published by Gabrielle Kuiper where software and distributed networks is used as an infrastructure alternative to new poles and wires.
Based on ‘backcasting’ scenarios for saturation levels of DER, it was found that rooftop solar plus battery trading reduces the 4-8 pm wholesale market evening peak by an impressive 67-92%. In addition to this, where local ‘trading’ is made ‘frictionless’, household batteries reduce the average summer network peak by 64%.
Andrew agrees with Kuiper’s assessment that these changes should not be used in arguing for greater network investment to cope with increasing electricity flows from DER, rather, they should be arguing for increased software investment to help facilitate these flows on their networks.
SwitchDin recently proposed a National Virtual Power Plant (VPP) Strategy to the Albanese Government which would enable households and businesses to access the untapped value in their latent flexibility through a flexibility services platform.
Investing in programs such as these will ensure that consumers are not left behind in the move toward cheaper, cleaner, and more reliable energy and enhance the skills development of Australia’s workforce.
To achieve strides in this area, we ask the Commonwealth Government to allocate funds to establish financing platforms for VPPs which would remove barriers for consumers, unlock further commercial opportunities, and support interoperability and integration for customer and network assets.
In addition to this, AEMO’s next ISP should revise DER uptake forecasts and attempt to integrate planning with distribution networks to better allocate funding to promising software integrations.
Learn more about our submission to the Australian Government regarding the use of VPPs to reduce energy bills for Australian Consumers here:
Read Gabrielle Kuiper’s article ‘Saturation DER modelling shows distributed energy and storage could lower costs for all consumers if we get the regulation right’ here: