Joining the grid not the best option

Analysis of the role of microgrids and stand-alone power systems could save energy customers around Australia a combined $1.7 billion in costs and provide more reliable services to edge-of-grid and remote customers.

The Energy Networks Association and CSIRO conducted the research as part of the Energy Network Transformation Roadmap program taking a long-range view to 2050.

ENA chief executive John Bradley addressed the Re-Powering New South Wales Energy conference and said the study by Energeia highlighted the need for new rules to ensure customers weren’t connected at a higher cost than necessary.

“At the grid edge, almost $700 million could be saved by supplying 27,000 future rural farm customers with a stand-alone system rather than building more poles and wires,” he said.

“By 2050 these customers could be supplied more cheaply and reliably with standalone systems using 2GW of solar PV… and 7.5GWh of battery storage.”

Connecting edge-of-grid and off-grid customers to stand-alone microgrids would reduce costs to other customer who cross-subsidies rural connections, he said.

“Australia needs modern rules for this to happen as most customers are effectively required to be connected to “poles and wires,” he said.

“These rural customers are supplied at the uniform network tariff, which makes it unlikely they will have a financial incentive to install their own stand-alone system.

“However, their network provider can support customers at the grid edge in smarter ways with savings to all customers and often a more reliable service for the rural customer.”

The analysis also looked at the scope for other customers to leave the grid, finding it could be more economical for some customers in 15-20 years.

“By 2050, the analysis shows up to 10 percent of customers could leave the grid using a stand alone system and that would result in higher costs for other customers,” Mr Bradley said.

“Customers with the ability to self-supply could be offered ‘win win’ incentives to stay on grid while operating in island mode during peak demand events.

“The analysis finds that incentivising customers with onsite resources to stay grid-connected could save all customers more than $1 billion in network charges between 2030-2050, equivalent to 4% per annum on average network bills.”

The Re-Powering New South Wales Energy Conference is being held this week in Sydney.