A new broom for Canberra

Heavy-duty broom against industrial looking floor
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By Phil Kreveld

The new broom in Canberra should sweep away the cobwebs hiding sensible electrical energy policy.

Australia is the world’s standout in the adoption of renewables—but also a brave experiment, watched keenly by international engineering experts. The time is now to draw the disparate strands of the national electricity system together into an engineering master plan for the benefit of taxpayers and consumers.

The new broom in Canberra should sweep away the cobwebs hiding sensible electrical energy policy. The zero marginal cost of renewable generation is popularly seen as a double blessing—lower electricity cost for consumers AND CO2 reduction! However, hidden from casual view is the cost of making the national grid fit for the purpose of connecting more and more renewable generation and therefore requiring a comprehensive, engineering-based review.

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That’s where Catch 22 is. The national grid and the links to it from remote energy zones have not kept pace with the influx of solar and wind generation. In the first place this is causing congestion—too much generation capacity connected to transmission lines with limited power carrying capacity, and secondly there are challenges to grid stability. Renewables provide very low marginal-cost energy, but the cost of capital investment in new grid construction and augmentation of existing infrastructure to accommodate high levels of renewable penetration can easily wipe out their energy cost advantages.

What is needed is a ‘master grid planner’ authorised by Canberra, to prevent unwise investment and over-investment in grids. That would provide an economically and environmentally sensible path for renewable generation growth and help contain energy costs for consumers since they inevitably have to bear network charges as part of their electricity tariff. No doubt, the response to this statement will be that we already have bodies such as the Energy Security Board (ESB), the Australian Energy Market Operator (AEMO), the Australian Energy Market Commission (AEMC) and the Australian Energy Regulator (AER). However, these bodies are essentially of a supervisory and regulatory nature and do not provide an overall, engineering-based electricity system design coordinating the elements of generation and networks.

AEMO issues an integrated systems plan (ISP) which is updated every two years to take account of new generator connection scenarios. However, AEMO lacks the authority to impose a consolidated grid plan specifying how much generation may be connected and for which individual transmission system operators (TSO) would have to adhere to stability and reliability criteria. Presently, individual TSO apply to the AER under the Regulated Investment Test for Transmission (RIT-T) for approval of new transmission projects. The projects are obviously based on required power flow, in part as predicted by the ISP, and are approved by the AER on the basis of economic benefit to electricity consumers. It might appear as a sort of master plan.

In actuality, the RIT-T based development approvals provide a piecemeal approach to grid development plans. An integrated plan would require the delineation of energy generating zones, their allowable aggregate maximum capacities based on carrying capacity of the links connecting the zones to major trunk, high voltage transmission corridors. In addition, the maximum power capacity of the high voltage transmission lines would have to be taken into account for possible augmentation.

Note the use of ‘maximum’ capacity. In order for the entire National Electricity Market (NEM) grid from Queensland to South Australia, to operate stably the grids must be able to accommodate power peaks—even if they occur only for short periods of time. Without the capacity to carry peak loads AEMO has to intervene, not only because of shortfalls in generated power but also because of grid insufficiency, isolating (islanding) some regions at times. These reliability and emergency reserve interventions (RERT) amount to several hundred instances per year. Thus, by means of this mechanism it is possible to stretch the use of the current network—but that is hardly a satisfactory state of affairs.

Economists have their use in planning and analysing energy markets: electrical engineers have their use in grid design and in working out what type of generation, and its maximum power capacity that can be connected. Regulators, in particular the AER, have their use in ensuring TSO do not overcharge for network use because of their oligarchic status. The AEMC’s lawyers have their use in drafting market operation rules. However, in a nutshell, leaving necessary grid sufficiency overviews and re-design to the economists, regulators and lawyers is hardly satisfactory!

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The new broom in Canberra would do well to initiate a comprehensive review of the engineering limitations currently imposed by the NEM grid for connecting more and more renewables and the cost implications. No doubt, politicians will want to defer to experts but care must be taken not to involve only the usual voices. The electrical engineering voice needs to be heard—and strongly—alongside those of the ESB, AEMO, AEMC and AER.

Australia is the world’s standout in the adoption of renewables and is in fact mounting a bold experiment, watched keenly by international engineering experts. The time is therefore now, to draw the disparate strands of the national electricity system together, including rooftop solar generation, individual state renewable generation and battery projects and the networks connecting them. The proposed master planner concept will bear fruit in providing a truly reliable growth path for renewables, for reaching CO2 reduction targets and achieving all this to the benefit of Australian taxpayers and electrical energy consumers.

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