Rapid rooftop solar uptake changing WEM paradigm

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The uptake of rooftop solar is accelerating a paradigm shift for the energy industry, according to Australian Energy Market Operator (AEMO) analysis.

Rooftop solar is estimated to have reduced 2016-2017’s peak demand in the SWIS by 265MW or 7.2 per cent to 3670MW on March 1, 2017 – the lowest summer peak observed in the South West Interconnected System (SWIS) since 2009, according to AEMO’s2017 Electricity Statement of Opportunities (ESOO) for the Wholesale Electricity Market (WEM).

“The rapid adoption of rooftop solar is not only slowing annual operational consumption growth but also eroding the mid-day grid demand and shifting peak demand to later in the day,” AEMO WA executive general manager Cameron Parrotte said.

“With the strong growth in rooftop solar installations anticipated, AEMO expects demand in the middle of the day to shrink further, resulting in a rapid increase in demand in the lead up to the evening peak once the sun sets.”

Typically known as the ‘duck curve’, this type of load profile requires generation to start and shut down more often in a very short space of time to meet demand.

“The duck curve is a factor that may contribute to a shifting market paradigm where thermal generators are facing higher operational costs alongside reduced demand,” Mr Parrotte said.

“Market and system reforms will need to be put in place to maintain system security and enable this transition at the lowest cost to consumers.”

Consistent with previous years, the Individual Reserve Capacity Requirement (IRCR) saw its highest IRCR response observed to date, further contributing to the lowest summer peak in the last seven years.

A total of 53 customers, incentivised to reduce load during high demand periods, reduced load by 124MW on March 1.

The 2017 WEM ESOO determined the Reserve Capacity Target (RCT) for the 2018-2019 and 2019-20 Capacity Years to be 4620MW and 4660MW respectively.

“While the current WEM is functioning, we need to plan ahead holistically in anticipation of a low carbon future with increased intermittent generation from renewable sources,” Mr Parrotte said.